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Minnesota Session Laws - 1999, Regular Session

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

                            CHAPTER 159-S.F.No. 1585 
                  An act relating to human services; making technical 
                  changes to cross-references in statutes; clarifying 
                  certain requirements; amending Minnesota Statutes 
                  1998, sections 13.46, subdivisions 1 and 2; 16D.02, 
                  subdivision 3; 16D.13, subdivision 3; 84.98, 
                  subdivision 3; 119A.54; 119B.01, subdivisions 2, 10, 
                  12, 13, 15, and 16; 119B.02, subdivision 1; 119B.03, 
                  subdivisions 3 and 4; 119B.05, subdivision 1; 119B.07; 
                  119B.075; 119B.08, subdivision 3; 119B.09, 
                  subdivisions 1, 3, and 7; 119B.14; 119B.15; 136A.125, 
                  subdivision 2; 145.415, subdivision 3; 145.93, 
                  subdivision 3; 196.27; 237.70, subdivision 4a; 
                  245.4871, subdivision 25; 252.28, subdivision 3a; 
                  254B.02, subdivision 1; 256.01, subdivisions 2 and 4; 
                  256.017, subdivisions 1, 2, and 4; 256.019; 256.025, 
                  subdivision 2; 256.046, subdivision 1; 256.0471, 
                  subdivision 1; 256.741, subdivisions 1 and 2; 256.82, 
                  subdivision 2; 256.935, subdivision 1; 256.98, 
                  subdivisions 1 and 8; 256.981; 256.983, subdivision 4; 
                  256.9861, subdivision 5; 256B.031, subdivisions 4 and 
                  5; 256B.69, subdivision 5a; 256C.21; 256C.23, 
                  subdivision 1; 256D.01, subdivisions 1a and 1e; 
                  256D.05, subdivisions 1, 3, and 5; 256D.051, 
                  subdivision 3a; 256D.055; 256D.23, subdivision 1; 
                  256D.435, subdivision 3; 256D.44, subdivision 5; 
                  256E.03, subdivision 2; 256E.06, subdivisions 1 and 3; 
                  256E.07, subdivision 1; 256E.08, subdivision 3; 
                  256F.05, subdivisions 3 and 8; 256F.10, subdivision 6; 
                  256F.13, subdivision 3; 256G.01, subdivision 4; 
                  256G.03, subdivision 2; 256J.01, subdivision 1; 
                  256J.11, subdivisions 1 and 2; 256J.12, subdivision 1; 
                  256J.21, subdivision 3; 256J.26, subdivisions 1, 2, 3, 
                  and 4; 256J.42, subdivisions 1 and 5; 256J.43, 
                  subdivision 1; 256J.50, subdivision 3a; 256J.62, 
                  subdivisions 3, 6, and 7; 256J.76, subdivision 1; 
                  256K.01, subdivisions 2, 3, and 8; 256K.015; 256K.02; 
                  256K.03, subdivisions 1 and 12; 256K.04, subdivision 
                  2; 256K.05, subdivision 2; 256K.06; 256K.07; 256K.08, 
                  subdivision 1; 256L.11, subdivision 4; 257.33, 
                  subdivision 2; 257.3573, subdivision 2; 257.60; 
                  257.85, subdivisions 3, 5, 7, and 11; 259.67, 
                  subdivision 4; 260.38; 261.063; 268.0111, subdivisions 
                  5 and 7; 268.0122, subdivision 3; 268.552, subdivision 
                  5; 268.672, subdivision 6; 268.86, subdivision 2; 
                  268.871, subdivision 1; 268.90, subdivision 2; 268.95, 
                  subdivision 4; 275.065, subdivision 5a; 290.067, 
                  subdivision 1; 290A.03, subdivision 7; 393.07, 
                  subdivision 6; 462A.205, subdivision 2; 462A.222, 
                  subdivision 1a; 473.129, subdivision 8; 477A.0122, 
                  subdivision 2; 501B.89, subdivision 2; 518.171, 
                  subdivision 1; 518.551, subdivision 5; 518.57, 
                  subdivision 3; 518.614, subdivision 3; 518.64, 
                  subdivision 2; 548.13; 550.136, subdivision 6; 
                  550.143, subdivision 3; 550.37, subdivision 14; 
                  551.05, subdivision 1a; 551.06, subdivision 6; 
                  570.025, subdivision 6; 570.026, subdivision 2; 
                  571.72, subdivision 8; 571.912; 571.925; 571.931, 
                  subdivision 6; 571.932, subdivision 2; and 583.22, 
                  subdivision 7b; repealing Minnesota Statutes 1998, 
                  sections 119B.01, subdivision 12a; 119B.05, 
                  subdivision 6; 126C.05, subdivision 4; 126C.06; 
                  256.031, subdivision 1a; 256.736; 256.74, subdivision 
                  1c; 256.9850; 256J.62, subdivision 5; 268.871, 
                  subdivision 5; and 290A.22; Minnesota Rules, parts 
                  9500.2000; 9500.2020; 9500.2060; 9500.2100; 9500.2140; 
                  9500.2180; 9500.2220; 9500.2260; 9500.2300; 9500.2340; 
                  9500.2380; 9500.2420; 9500.2440; 9500.2480; 9500.2500; 
                  9500.2520; 9500.2560; 9500.2580; 9500.2600; 9500.2620; 
                  9500.2640; 9500.2680; 9500.2700; 9500.2720; 9500.2722; 
                  9500.2724; 9500.2726; 9500.2728; 9500.2730; 9500.2740; 
                  9500.2760; 9500.2780; 9500.2800; 9500.2820; 9500.2860; 
                  and 9500.2880. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 1998, section 13.46, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DEFINITIONS.] As used in this section: 
           (a) "Individual" means an individual according to section 
        13.02, subdivision 8, but does not include a vendor of services. 
           (b) "Program" includes all programs for which authority is 
        vested in a component of the welfare system according to statute 
        or federal law, including, but not limited to, the aid to 
        families with dependent children program formerly codified in 
        sections 256.72 to 256.87, Minnesota family investment 
        program-statewide, medical assistance, general assistance, 
        general assistance medical care, and child support collections.  
           (c) "Welfare system" includes the department of human 
        services, local social services agencies, county welfare 
        agencies, the public authority responsible for child support 
        enforcement, human services boards, community mental health 
        center boards, state hospitals, state nursing homes, the 
        ombudsman for mental health and mental retardation, and persons, 
        agencies, institutions, organizations, and other entities under 
        contract to any of the above agencies to the extent specified in 
        the contract. 
           (d) "Mental health data" means data on individual clients 
        and patients of community mental health centers, established 
        under section 245.62, mental health divisions of counties and 
        other providers under contract to deliver mental health 
        services, or the ombudsman for mental health and mental 
        retardation. 
           (e) "Fugitive felon" means a person who has been convicted 
        of a felony and who has escaped from confinement or violated the 
        terms of probation or parole for that offense. 
           Sec. 2.  Minnesota Statutes 1998, section 13.46, 
        subdivision 2, is amended to read: 
           Subd. 2.  [GENERAL.] (a) Unless the data is summary data or 
        a statute specifically provides a different classification, data 
        on individuals collected, maintained, used, or disseminated by 
        the welfare system is private data on individuals, and shall not 
        be disclosed except:  
           (1) according to section 13.05; 
           (2) according to court order; 
           (3) according to a statute specifically authorizing access 
        to the private data; 
           (4) to an agent of the welfare system, including a law 
        enforcement person, attorney, or investigator acting for it in 
        the investigation or prosecution of a criminal or civil 
        proceeding relating to the administration of a program; 
           (5) to personnel of the welfare system who require the data 
        to determine eligibility, amount of assistance, and the need to 
        provide services of additional programs to the individual; 
           (6) to administer federal funds or programs; 
           (7) between personnel of the welfare system working in the 
        same program; 
           (8) the amounts of cash public assistance and relief paid 
        to welfare recipients in this state, including their names, 
        social security numbers, income, addresses, and other data as 
        required, upon request by the department of revenue to 
        administer the property tax refund law, supplemental housing 
        allowance, early refund of refundable tax credits, and the 
        income tax.  "Refundable tax credits" means the dependent care 
        credit under section 290.067, the Minnesota working family 
        credit under section 290.0671, the property tax refund under 
        section 290A.04, and, if the required federal waiver or waivers 
        are granted, the federal earned income tax credit under section 
        32 of the Internal Revenue Code; 
           (9) between the department of human services and the 
        Minnesota department of economic security for the purpose of 
        monitoring the eligibility of the data subject for reemployment 
        insurance, for any employment or training program administered, 
        supervised, or certified by that agency, for the purpose of 
        administering any rehabilitation program, whether alone or in 
        conjunction with the welfare system, or to monitor and evaluate 
        the statewide Minnesota family investment program by exchanging 
        data on recipients and former recipients of food stamps, cash 
        assistance under chapter 256, 256D, 256J, or 256K, child care 
        assistance under chapter 119B, or medical programs under chapter 
        256B, 256D, or 256L; 
           (10) to appropriate parties in connection with an emergency 
        if knowledge of the information is necessary to protect the 
        health or safety of the individual or other individuals or 
        persons; 
           (11) data maintained by residential programs as defined in 
        section 245A.02 may be disclosed to the protection and advocacy 
        system established in this state according to Part C of Public 
        Law Number 98-527 to protect the legal and human rights of 
        persons with mental retardation or other related conditions who 
        live in residential facilities for these persons if the 
        protection and advocacy system receives a complaint by or on 
        behalf of that person and the person does not have a legal 
        guardian or the state or a designee of the state is the legal 
        guardian of the person; 
           (12) to the county medical examiner or the county coroner 
        for identifying or locating relatives or friends of a deceased 
        person; 
           (13) data on a child support obligor who makes payments to 
        the public agency may be disclosed to the higher education 
        services office to the extent necessary to determine eligibility 
        under section 136A.121, subdivision 2, clause (5); 
           (14) participant social security numbers and names 
        collected by the telephone assistance program may be disclosed 
        to the department of revenue to conduct an electronic data match 
        with the property tax refund database to determine eligibility 
        under section 237.70, subdivision 4a; 
           (15) the current address of a recipient of aid to families 
        with dependent children or Minnesota family investment 
        program-statewide may be disclosed to law enforcement officers 
        who provide the name of the recipient and notify the agency that:
           (i) the recipient: 
           (A) is a fugitive felon fleeing to avoid prosecution, or 
        custody or confinement after conviction, for a crime or attempt 
        to commit a crime that is a felony under the laws of the 
        jurisdiction from which the individual is fleeing; or 
           (B) is violating a condition of probation or parole imposed 
        under state or federal law; 
           (ii) the location or apprehension of the felon is within 
        the law enforcement officer's official duties; and 
           (iii)  the request is made in writing and in the proper 
        exercise of those duties; 
           (16) the current address of a recipient of general 
        assistance or general assistance medical care may be disclosed 
        to probation officers and corrections agents who are supervising 
        the recipient and to law enforcement officers who are 
        investigating the recipient in connection with a felony level 
        offense; 
           (17) information obtained from food stamp applicant or 
        recipient households may be disclosed to local, state, or 
        federal law enforcement officials, upon their written request, 
        for the purpose of investigating an alleged violation of the 
        Food Stamp Act, according to Code of Federal Regulations, title 
        7, section 272.1(c); 
           (18) the address, social security number, and, if 
        available, photograph of any member of a household receiving 
        food stamps shall be made available, on request, to a local, 
        state, or federal law enforcement officer if the officer 
        furnishes the agency with the name of the member and notifies 
        the agency that:  
           (i) the member: 
           (A) is fleeing to avoid prosecution, or custody or 
        confinement after conviction, for a crime or attempt to commit a 
        crime that is a felony in the jurisdiction the member is 
        fleeing; 
           (B) is violating a condition of probation or parole imposed 
        under state or federal law; or 
           (C) has information that is necessary for the officer to 
        conduct an official duty related to conduct described in subitem 
        (A) or (B); 
           (ii) locating or apprehending the member is within the 
        officer's official duties; and 
           (iii) the request is made in writing and in the proper 
        exercise of the officer's official duty; 
           (19) certain information regarding child support obligors 
        who are in arrears may be made public according to section 
        518.575; 
           (20) data on child support payments made by a child support 
        obligor and data on the distribution of those payments excluding 
        identifying information on obligees may be disclosed to all 
        obligees to whom the obligor owes support, and data on the 
        enforcement actions undertaken by the public authority, the 
        status of those actions, and data on the income of the obligor 
        or obligee may be disclosed to the other party; 
           (21) data in the work reporting system may be disclosed 
        under section 256.998, subdivision 7; 
           (22) to the department of children, families, and learning 
        for the purpose of matching department of children, families, 
        and learning student data with public assistance data to 
        determine students eligible for free and reduced price meals, 
        meal supplements, and free milk according to United States Code, 
        title 42, sections 1758, 1761, 1766, 1766a, 1772, and 1773; to 
        produce accurate numbers of students receiving aid to families 
        with dependent children or assistance from the Minnesota family 
        investment program-statewide program as required by section 
        126C.06; to allocate federal and state funds that are 
        distributed based on income of the student's family; and to 
        verify receipt of energy assistance for the telephone assistance 
        plan; 
           (23) the current address and telephone number of program 
        recipients and emergency contacts may be released to the 
        commissioner of health or a local board of health as defined in 
        section 145A.02, subdivision 2, when the commissioner or local 
        board of health has reason to believe that a program recipient 
        is a disease case, carrier, suspect case, or at risk of illness, 
        and the data are necessary to locate the person; 
           (24) to other state agencies, statewide systems, and 
        political subdivisions of this state, including the attorney 
        general, and agencies of other states, interstate information 
        networks, federal agencies, and other entities as required by 
        federal regulation or law for the administration of the child 
        support enforcement program; 
           (25) to personnel of public assistance programs as defined 
        in section 256.741, for access to the child support system 
        database for the purpose of administration, including monitoring 
        and evaluation of those public assistance programs; or 
           (26) to monitor and evaluate the statewide Minnesota family 
        investment program by exchanging data between the departments of 
        human services and children, families, and learning, on 
        recipients and former recipients of food stamps, cash assistance 
        under chapter 256, 256D, 256J, or 256K, child care assistance 
        under chapter 119B, or medical programs under chapter 256B, 
        256D, or 256L.  
           (b) Information on persons who have been treated for drug 
        or alcohol abuse may only be disclosed according to the 
        requirements of Code of Federal Regulations, title 42, sections 
        2.1 to 2.67. 
           (c) Data provided to law enforcement agencies under 
        paragraph (a), clause (15), (16), (17), or (18), or paragraph 
        (b), are investigative data and are confidential or protected 
        nonpublic while the investigation is active.  The data are 
        private after the investigation becomes inactive under section 
        13.82, subdivision 5, paragraph (a) or (b). 
           (d) Mental health data shall be treated as provided in 
        subdivisions 7, 8, and 9, but is not subject to the access 
        provisions of subdivision 10, paragraph (b). 
           Sec. 3.  Minnesota Statutes 1998, section 16D.02, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DEBT.] "Debt" means an amount owed to the state 
        directly, or through a state agency, on account of a fee, duty, 
        lease, direct loan, loan insured or guaranteed by the state, 
        rent, service, sale of real or personal property, overpayment, 
        fine, assessment, penalty, restitution, damages, interest, tax, 
        bail bond, forfeiture, reimbursement, liability owed, an 
        assignment to the state including assignments under sections 
        256.72 to 256.87 section 256.741, the Social Security Act, or 
        other state or federal law, recovery of costs incurred by the 
        state, or any other source of indebtedness to the state.  Debt 
        also includes amounts owed to individuals as a result of civil, 
        criminal, or administrative action brought by the state or a 
        state agency pursuant to its statutory authority or for which 
        the state or state agency acts in a fiduciary capacity in 
        providing collection services in accordance with the regulations 
        adopted under the Social Security Act at Code of Federal 
        Regulations, title 45, section 302.33.  Debt also includes an 
        amount owed to the courts or University of Minnesota for which 
        the commissioner provides collection services pursuant to 
        contract. 
           Sec. 4.  Minnesota Statutes 1998, section 16D.13, 
        subdivision 3, is amended to read: 
           Subd. 3.  [EXCLUSION.] A state agency may not charge 
        interest under this section on overpayments of assistance 
        benefits under the programs formerly codified in sections 
        256.031 to 256.0361, 256.72 to 256.87, and under chapters 256D 
        and 256I, or the federal food stamp program.  Notwithstanding 
        this prohibition, any debts that have been reduced to judgment 
        under these programs are subject to the interest charges 
        provided under section 549.09. 
           Sec. 5.  Minnesota Statutes 1998, section 84.98, 
        subdivision 3, is amended to read: 
           Subd. 3.  [CRITERIA FOR DETERMINING ECONOMIC, SOCIAL, 
        PHYSICAL, OR EDUCATIONAL DISADVANTAGE.] (a) The criteria for 
        determining economic, social, physical, or educational 
        disadvantage shall be determined as provided in this subdivision.
           (b) Economically disadvantaged are persons who meet the 
        criteria for disadvantaged established by the department of 
        economic security or persons receiving services provided by the 
        department of human services such as welfare payments, food 
        stamps, aid to families with dependent children or Minnesota 
        family investment program-statewide program.  
           (c) Socially disadvantaged are persons who have been 
        classified as persons in need of supervision by the court system.
           (d) Physically disadvantaged are persons who have been 
        identified as having special needs by public agencies that deal 
        with employment for the disabled. 
           (e) Educationally disadvantaged are persons who have 
        dropped out of school or are at risk of dropping out of school 
        and persons with learning disabilities or in need of special 
        education classes.  
           Sec. 6.  Minnesota Statutes 1998, section 119A.54, is 
        amended to read: 
           119A.54 [REPORTS.] 
           Each grantee shall submit an annual report to the 
        commissioner of children, families, and learning on the format 
        designated by the commissioner, including program information 
        report data.  By January 1 of each year, the commissioner shall 
        prepare an annual report to the health and human services policy 
        committee of the house of representatives and the health and 
        family security services committee of the senate concerning the 
        uses and impact of head start supplemental funding, including a 
        summary of innovative programs and the results of innovative 
        programs and an evaluation of the coordination of head start 
        programs with employment and training services provided to AFDC 
        and MFIP-S MFIP recipients. 
           Sec. 7.  Minnesota Statutes 1998, section 119B.01, 
        subdivision 2, is amended to read: 
           Subd. 2.  [APPLICANT.] "Child care fund applicants" means 
        all parents, stepparents, legal guardians, or eligible 
        relative caretakers caregivers who reside in the household that 
        applies for child care assistance under the child care fund. 
           Sec. 8.  Minnesota Statutes 1998, section 119B.01, 
        subdivision 10, is amended to read: 
           Subd. 10.  [FAMILY.] "Family" means parents, stepparents, 
        guardians and their spouses, or other eligible 
        relative caretakers caregivers and their spouses, and their 
        blood related dependent children and adoptive siblings under the 
        age of 18 years living in the same home including children 
        temporarily absent from the household in settings such as 
        schools, foster care, and residential treatment facilities.  
        When a minor parent or parents and his, her, or their child or 
        children are living with other relatives, and the minor parent 
        or parents apply for a child care subsidy, "family" means only 
        the minor parent or parents and the child or children.  An adult 
        may be considered a dependent member of the family unit if 50 
        percent of the adult's support is being provided by the parents, 
        stepparents, guardians and their spouses, or eligible 
        relative caretakers caregivers and their spouses, residing in 
        the same household.  An adult age 18 who is a full-time high 
        school student and can reasonably be expected to graduate before 
        age 19 may be considered a dependent member of the family unit. 
           Sec. 9.  Minnesota Statutes 1998, section 119B.01, 
        subdivision 12, is amended to read: 
           Subd. 12.  [INCOME.] "Income" means earned or unearned 
        income received by all family members, including public 
        assistance cash benefits, unless specifically excluded.  The 
        following are excluded from income:  funds used to pay for 
        health insurance premiums for family members, Supplemental 
        Security Income, scholarships, work-study income, and grants 
        that cover costs for tuition, fees, books, and educational 
        supplies; student loans for tuition, fees, books, supplies, and 
        living expenses; earned income tax credits; in-kind income such 
        as food stamps, energy assistance, medical assistance, and 
        housing subsidies; earned income of full or part-time secondary 
        school students up to the age of 19, including summer 
        employment; grant awards under the family subsidy program; 
        nonrecurring lump sum income only to the extent that it is 
        earmarked and used for the purpose for which it is paid; and any 
        income assigned to the public authority according to section 
        256.74 or 256.741, if enacted. 
           Sec. 10.  Minnesota Statutes 1998, section 119B.01, 
        subdivision 13, is amended to read: 
           Subd. 13.  [PROVIDER.] "Provider" means a child care 
        license holder who operates a family day care home, a group 
        family day care home, a day care center, a nursery school, a day 
        nursery, an extended day school age child care program; a legal 
        nonlicensed extended day school age child care program which 
        operates under the auspices of a local school board that has 
        adopted school age child care standards which meet or exceed 
        standards recommended by the state department of children, 
        families, and learning, or a legal nonlicensed caregiver who is 
        at least 18 years of age, and who is not a member of the AFDC 
        Minnesota family investment program assistance unit.  
           Sec. 11.  Minnesota Statutes 1998, section 119B.01, 
        subdivision 15, is amended to read: 
           Subd. 15.  [AFDC MINNESOTA FAMILY INVESTMENT PROGRAM AND 
        WORK FIRST PROGRAM.] "AFDC" means the aid to families with 
        dependent children program under sections 256.72 to 256.87; The 
        MFIP Minnesota family investment program under sections 256.031 
        to 256.0361 and 256.0475 to 256.049; the MFIP-S program under 
        chapter 256J; and the work first program under chapter 256K, 
        whichever program is in effect are the state's programs which 
        are required under title I of Public Law Number 104-193, the 
        Personal Responsibility and Work Opportunity Reconciliation Act 
        of 1996. 
           Sec. 12.  Minnesota Statutes 1998, section 119B.01, 
        subdivision 16, is amended to read: 
           Subd. 16.  [TRANSITION YEAR FAMILIES.] "Transition year 
        families" means families who have received AFDC assistance under 
        the Minnesota family investment program, or who were eligible to 
        receive AFDC assistance under the Minnesota family investment 
        program after choosing to discontinue receipt of the cash 
        portion of MFIP-S MFIP assistance under section 256J.31, 
        subdivision 12, for at least three of the last six months before 
        losing eligibility for AFDC the Minnesota family investment 
        program due to increased hours of employment, or increased 
        income from employment or child or spousal support. 
           Sec. 13.  Minnesota Statutes 1998, section 119B.02, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [CHILD CARE SERVICES.] The commissioner 
        shall develop standards for county and human services boards to 
        provide child care services to enable eligible families to 
        participate in employment, training, or education programs.  
        Within the limits of available appropriations, the commissioner 
        shall distribute money to counties to reduce the costs of child 
        care for eligible families.  The commissioner shall adopt rules 
        to govern the program in accordance with this section.  The 
        rules must establish a sliding schedule of fees for parents 
        receiving child care services.  The rules shall provide that 
        funds received as a lump sum payment of child support arrearages 
        shall not be counted as income to a family in the month received 
        but shall be prorated over the 12 months following receipt and 
        added to the family income during those months.  In the rules 
        adopted under this section, county and human services boards 
        shall be authorized to establish policies for payment of child 
        care spaces for absent children, when the payment is required by 
        the child's regular provider.  The rules shall not set a maximum 
        number of days for which absence payments can be made, but 
        instead shall direct the county agency to set limits and pay for 
        absences according to the prevailing market practice in the 
        county.  County policies for payment of absences shall be 
        subject to the approval of the commissioner.  The commissioner 
        shall maximize the use of federal money in section 256.736 under 
        title I and title IV of Public Law Number 104-193, the Personal 
        Responsibility and Work Opportunity Reconciliation Act of 1996 
        and other programs that provide federal or state reimbursement 
        for child care services for low-income families who are in 
        education, training, job search, or other activities allowed 
        under those programs.  Money appropriated under this section 
        must be coordinated with the programs that provide federal 
        reimbursement for child care services to accomplish this 
        purpose.  Federal reimbursement obtained must be allocated to 
        the county that spent money for child care that is federally 
        reimbursable under programs that provide federal reimbursement 
        for child care services.  The counties shall use the federal 
        money to expand child care services.  The commissioner may adopt 
        rules under chapter 14 to implement and coordinate federal 
        program requirements. 
           Sec. 14.  Minnesota Statutes 1998, section 119B.03, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ELIGIBLE RECIPIENTS.] Families that meet the 
        eligibility requirements under sections 119B.09, except AFDC 
        recipients, MFIP recipients, and transition year families, and 
        119B.10 are eligible for child care assistance under the basic 
        sliding fee program.  Families enrolled in the basic sliding fee 
        program shall be continued until they are no longer eligible.  
        Child care assistance provided through the child care fund is 
        considered assistance to the parent. 
           Sec. 15.  Minnesota Statutes 1998, section 119B.03, 
        subdivision 4, is amended to read: 
           Subd. 4.  [FUNDING PRIORITY.] (a) First priority for child 
        care assistance under the basic sliding fee program must be 
        given to eligible non-AFDC non-Minnesota family investment 
        program families who do not have a high school or general 
        equivalency diploma or who need remedial and basic skill courses 
        in order to pursue employment or to pursue education leading to 
        employment.  Within this priority, the following subpriorities 
        must be used: 
           (1) child care needs of minor parents; 
           (2) child care needs of parents under 21 years of age; and 
           (3) child care needs of other parents within the priority 
        group described in this paragraph. 
           (b) Second priority must be given to parents who have 
        completed their AFDC Minnesota family investment program 
        transition year. 
           (c) Third priority must be given to families who are 
        eligible for portable basic sliding fee assistance through the 
        portability pool under subdivision 9. 
           Sec. 16.  Minnesota Statutes 1998, section 119B.05, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ELIGIBLE RECIPIENTS.] Families eligible 
        for child care assistance under the AFDC Minnesota family 
        investment program child care program are: 
           (1) persons receiving services under sections 256.031 to 
        256.0361 and 256.047 to 256.048; 
           (2) AFDC Minnesota family investment program recipients who 
        are employed or in job search and meet the requirements of 
        section 119B.10; 
           (3) (2) persons who are members of transition year families 
        under section 119B.01, subdivision 16; 
           (4) members of the control group for the STRIDE evaluation 
        conducted by the Manpower Demonstration Research Corporation; 
           (5) AFDC caretakers who are participating in the STRIDE and 
        non-STRIDE AFDC child care program; 
           (6) (3) families who are participating in employment 
        orientation or job search, or other employment or training 
        activities that are included in an approved employability 
        development plan under chapter 256K; and 
           (7) MFIP-S (4) MFIP families who are participating in work 
        activities as required in their job search support or employment 
        plan, or in appeals, hearings, assessments, or orientations 
        according to chapter 256J.  Child care assistance to support 
        work activities as described in section 256J.49 must be 
        available according to sections 119A.54, 119B.01, subdivision 8, 
        124D.13, 256E.08, and 611A.32 and titles IVA, IVB, IVE, and XX 
        of the Social Security Act. 
           Sec. 17.  Minnesota Statutes 1998, section 119B.07, is 
        amended to read: 
           119B.07 [USE OF MONEY.] 
           Money for persons listed in sections 119B.03, subdivision 
        3, and 119B.05, subdivision 1, shall be used to reduce the costs 
        of child care for students, including the costs of child care 
        for students while employed if enrolled in an eligible education 
        program at the same time and making satisfactory progress 
        towards completion of the program.  Counties may not limit the 
        duration of child care subsidies for a person in an employment 
        or educational program, except when the person is found to be 
        ineligible under the child care fund eligibility standards.  Any 
        limitation must be based on a person's employability plan in the 
        case of an AFDC a Minnesota family investment program recipient, 
        and county policies included in the child care allocation plan.  
        The maximum length of time a student is eligible for child care 
        assistance under the child care fund for education and training 
        is no more than the time necessary to complete the credit 
        requirements for an associate or baccalaureate degree as 
        determined by the educational institution, excluding basic or 
        remedial education programs needed to prepare for post-secondary 
        education or employment.  To be eligible, the student must be in 
        good standing and be making satisfactory progress toward the 
        degree.  Time limitations for child care assistance do not apply 
        to basic or remedial educational programs needed to prepare for 
        post-secondary education or employment.  These programs 
        include:  high school, general equivalency diploma, and English 
        as a second language.  Programs exempt from this time limit must 
        not run concurrently with a post-secondary program.  High school 
        students who are participating in a post-secondary options 
        program and who receive a high school diploma issued by the 
        school district are exempt from the time limitations while 
        pursuing a high school diploma.  Financially eligible students 
        who have received child care assistance for one academic year 
        shall be provided child care assistance in the following 
        academic year if funds allocated under sections 119B.03 and 
        119B.05 are available.  If an AFDC a Minnesota family investment 
        program recipient who is receiving AFDC Minnesota family 
        investment program child care assistance under this chapter 
        moves to another county, continues to participate in educational 
        or training programs authorized in their employability 
        development plans, and continues to be eligible for AFDC the 
        Minnesota family investment program child care assistance under 
        this chapter, the AFDC caretaker Minnesota family investment 
        program caregiver must receive continued child care assistance 
        from the county responsible for their current employability 
        development plan, without interruption. 
           Sec. 18.  Minnesota Statutes 1998, section 119B.075, is 
        amended to read: 
           119B.075 [RESERVE ACCOUNT.] 
           A reserve account must be created within the general fund 
        for all unexpended basic sliding fee child care, TANF child 
        care, or other child care funds under the jurisdiction of the 
        commissioner.  Any funds for those purposes that are unexpended 
        at the end of a biennium must be deposited in this reserve 
        account, and may be appropriated on an ongoing basis by the 
        commissioner for basic sliding fee child care or TANF MFIP child 
        care. 
           Sec. 19.  Minnesota Statutes 1998, section 119B.08, 
        subdivision 3, is amended to read: 
           Subd. 3.  [CHILD CARE FUND PLAN.] Effective January 1, 
        1992, the county will include the plan required under this 
        subdivision in its biennial community social services plan 
        required in this section, for the group described in section 
        256E.03, subdivision 2, paragraph (h).  The commissioner shall 
        establish the dates by which the county must submit these 
        plans.  The county and designated administering agency shall 
        submit to the commissioner an annual child care fund allocation 
        plan.  The plan shall include: 
           (1) a narrative of the total program for child care 
        services, including all policies and procedures that affect 
        eligible families and are used to administer the child care 
        funds; 
           (2) the methods used by the county to inform eligible 
        groups of the availability of child care assistance and related 
        services; 
           (3) the provider rates paid for all children by provider 
        type; 
           (4) the county prioritization policy for all eligible 
        groups under the basic sliding fee program and AFDC the 
        Minnesota family investment program and child care program; and 
           (5) other information as requested by the department to 
        ensure compliance with the child care fund statutes and rules 
        promulgated by the commissioner. 
           The commissioner shall notify counties within 60 days of 
        the date the plan is submitted whether the plan is approved or 
        the corrections or information needed to approve the plan.  The 
        commissioner shall withhold a county's allocation until it has 
        an approved plan.  Plans not approved by the end of the second 
        quarter after the plan is due may result in a 25 percent 
        reduction in allocation.  Plans not approved by the end of the 
        third quarter after the plan is due may result in a 100 percent 
        reduction in the allocation to the county.  Counties are to 
        maintain services despite any reduction in their allocation due 
        to plans not being approved. 
           Sec. 20.  Minnesota Statutes 1998, section 119B.09, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GENERAL ELIGIBILITY REQUIREMENTS FOR ALL 
        APPLICANTS FOR CHILD CARE ASSISTANCE.] (a) Child care services 
        must be available to families who need child care to find or 
        keep employment or to obtain the training or education necessary 
        to find employment and who: 
           (1) meet the requirements of section 119B.05; receive aid 
        to families with dependent children, MFIP-S, assistance under 
        MFIP or work first, whichever is in effect; and are receiving 
        participating in employment and training services under section 
        256.736 or chapter 256J or 256K; 
           (2) have household income below the eligibility levels for 
        aid to families with dependent children Minnesota family 
        investment program; or 
           (3) have household income within a range established by the 
        commissioner. 
           (b) Child care services for the families receiving aid to 
        families with dependent children Minnesota family investment 
        program assistance must be made available as in-kind services, 
        to cover any difference between the actual cost and the amount 
        disregarded under the aid to families with dependent children 
        program.  Child care services to families whose incomes are 
        below the threshold of eligibility for aid to families with 
        dependent children Minnesota family investment program, but are 
        not AFDC caretakers MFIP caregivers, must be made available with 
        the same copayment required of AFDC caretakers or MFIP-S MFIP 
        caregivers. 
           (c) All applicants for child care assistance and families 
        currently receiving child care assistance must be assisted and 
        required to cooperate in establishment of paternity and 
        enforcement of child support obligations as a condition of 
        program eligibility.  For purposes of this section, a family is 
        considered to meet the requirement for cooperation when the 
        family complies with the requirements of section 256.741, if 
        enacted. 
           Sec. 21.  Minnesota Statutes 1998, section 119B.09, 
        subdivision 3, is amended to read: 
           Subd. 3.  [PRIORITIES; ALLOCATIONS.] If a county projects 
        that its child care allocation is insufficient to meet the needs 
        of all eligible groups, it may prioritize among the groups that 
        remain to be served after the county has complied with the 
        priority requirements of section 119B.03.  Counties that have 
        established a priority for non-AFDC non-Minnesota family 
        investment program families beyond those established under 
        section 119B.03 must submit the policy in the annual allocation 
        plan. 
           Sec. 22.  Minnesota Statutes 1998, section 119B.09, 
        subdivision 7, is amended to read: 
           Subd. 7.  [ELIGIBILITY FOR ASSISTANCE.] The date of 
        eligibility for child care assistance under this chapter is the 
        later of the date the application was signed; the beginning date 
        of employment, education, or training; or the date a 
        determination has been made that the applicant is a participant 
        in employment and training services under Minnesota Rules, part 
        3400.0080, subpart 2a, section 256.736, or chapter 256J or 
        256K.  The date of eligibility for the basic sliding fee at-home 
        infant child care program is the later of the date the infant is 
        born or, in a county with a basic sliding fee wait list, the 
        date the family applies for at-home infant child care.  Payment 
        ceases for a family under the at-home infant child care program 
        when a family has used a total of 12 months of assistance as 
        specified under section 119B.061.  Payment of child care 
        assistance for employed persons on AFDC MFIP is effective the 
        date of employment or the date of AFDC MFIP eligibility, 
        whichever is later.  Payment of child care assistance for MFIP-S 
        MFIP or work first participants in employment and training 
        services is effective the date of commencement of the services 
        or the date of MFIP-S MFIP or work first eligibility, whichever 
        is later.  Payment of child care assistance for transition year 
        child care must be made retroactive to the date of eligibility 
        for transition year child care. 
           Sec. 23.  Minnesota Statutes 1998, section 119B.14, is 
        amended to read: 
           119B.14 [EXTENSION OF EMPLOYMENT OPPORTUNITIES.] 
           The county board shall insure ensure that child care 
        services available to eligible residents are well advertised and 
        that everyone who receives or applies for aid to families with 
        dependent children assistance under the Minnesota family 
        investment program is informed of training and employment 
        opportunities and programs, including child care assistance and 
        child care resource and referral services. 
           Sec. 24.  Minnesota Statutes 1998, section 119B.15, is 
        amended to read: 
           119B.15 [ADMINISTRATIVE EXPENSES.] 
           The commissioner shall use up to 1/21 of the state and 
        federal funds available for the basic sliding fee program and 
        1/21 of the state and federal funds available for the AFDC 
        Minnesota family investment program child care program for 
        payments to counties for administrative expenses.  
           Sec. 25.  Minnesota Statutes 1998, section 136A.125, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ELIGIBLE STUDENTS.] An applicant is eligible for 
        a child care grant if the applicant: 
           (1) is a resident of the state of Minnesota; 
           (2) has a child 12 years of age or younger, or 14 years of 
        age or younger who is handicapped as defined in section 125A.02, 
        and who is receiving or will receive care on a regular basis 
        from a licensed or legal, nonlicensed caregiver; 
           (3) is income eligible as determined by the office's 
        policies and rules, but is not a recipient of assistance from 
        either aid to families with dependent children or the Minnesota 
        family investment program-statewide program; 
           (4) has not earned a baccalaureate degree and has been 
        enrolled full time less than eight semesters, 12 quarters, or 
        the equivalent; 
           (5) is pursuing a nonsectarian program or course of study 
        that applies to an undergraduate degree, diploma, or 
        certificate; 
           (6) is enrolled at least half time in an eligible 
        institution; and 
           (7) is in good academic standing and making satisfactory 
        academic progress. 
           Sec. 26.  Minnesota Statutes 1998, section 145.415, 
        subdivision 3, is amended to read: 
           Subd. 3.  [STATUS.] (1) Unless the abortion is performed to 
        save the life of the woman or child, or, (2) unless one or both 
        of the parents of the unborn child agrees within 30 days of the 
        birth to accept the parental rights and responsibilities for the 
        child if it survives the abortion, whenever an abortion of a 
        potentially viable fetus results in a live birth, the child 
        shall be an abandoned ward of the state and the parents shall 
        have no parental rights or obligations as if the parental rights 
        had been terminated pursuant to section 260.221.  The child 
        shall be provided for pursuant to sections 256.12, subdivision 
        14 and 256.72 to 256.87 chapter 256J.  
           Sec. 27.  Minnesota Statutes 1998, section 145.93, 
        subdivision 3, is amended to read: 
           Subd. 3.  [GRANT AWARD; DESIGNATION; PAYMENTS UNDER GRANT.] 
        Each odd-numbered year the commissioner shall solicit 
        applications for the poison information centers by giving 
        reasonable public notice of the availability of money 
        appropriated or otherwise available.  The commissioner shall 
        select from among the nonprofit corporations entities, whether 
        profit or nonprofit, or units of government the applicants that 
        best fulfill the criteria specified in subdivision 4.  The grant 
        shall be paid to the grantees quarterly beginning on July 1. 
           Sec. 28.  Minnesota Statutes 1998, section 196.27, is 
        amended to read: 
           196.27 [AGENT ORANGE SETTLEMENT PAYMENTS.] 
           (a) Payments received by veterans or their dependents 
        because of settlements between them and the manufacturers of 
        Agent Orange or other chemical agents, as defined in section 
        196.21, must not be treated as income (or an available resource) 
        of the veterans or their dependents for the purposes of any 
        program of public assistance or benefit program administered by 
        the department of veterans affairs, the department of human 
        services, or other agencies of the state or political 
        subdivisions of the state, except as provided in paragraph (b). 
           (b) The income and resource exclusion in paragraph (a) does 
        not apply to the medical assistance, food stamps, aid to 
        families with dependent children or Minnesota family investment 
        program-statewide programs until the commissioner of human 
        services receives formal approval from the United States 
        Department of Health and Human Services, for the medical 
        assistance, aid to families with dependent children or Minnesota 
        family investment program-statewide programs, and from the 
        United States Department of Agriculture, for the food stamps 
        program.  The income exclusion does not apply to the Minnesota 
        supplemental aid program until the commissioner receives formal 
        federal approval of the exclusion for the medical assistance 
        program. 
           Sec. 29.  Minnesota Statutes 1998, section 237.70, 
        subdivision 4a, is amended to read: 
           Subd. 4a.  [HOUSEHOLD ELIGIBLE FOR CREDIT.] The telephone 
        assistance plan must provide telephone assistance credit for a 
        residential household in Minnesota that meets each of the 
        following criteria: 
           (1) has a household member who: 
           (i) subscribes to local exchange service; and 
           (ii) is either disabled or 65 years of age or older; 
           (2) whose household income is 150 percent or less of 
        federal poverty guidelines or is currently eligible for: 
           (i) aid to families with dependent children or Minnesota 
        family investment program-statewide program; 
           (ii) medical assistance; 
           (iii) general assistance; 
           (iv) Minnesota supplemental aid; 
           (v) food stamps; 
           (vi) refugee cash assistance or refugee medical assistance; 
           (vii) energy assistance; or 
           (viii) supplemental security income; and 
           (3) who has been certified as eligible for telephone 
        assistance plan credits. 
           Sec. 30.  Minnesota Statutes 1998, section 245.4871, 
        subdivision 25, is amended to read: 
           Subd. 25.  [MENTAL HEALTH FUNDS.] "Mental health funds" are 
        funds expended under sections 245.73 and 256E.12, federal mental 
        health block grant funds, and funds expended under 
        sections section 256D.06 and 256D.37 to facilities licensed 
        under Minnesota Rules, parts 9520.0500 to 9520.0690. 
           Sec. 31.  Minnesota Statutes 1998, section 252.28, 
        subdivision 3a, is amended to read: 
           Subd. 3a.  [LICENSING EXCEPTION.] (a) Notwithstanding the 
        provisions of subdivision 3, the commissioner may license 
        service sites, each accommodating up to six residents moving 
        from a 48-bed intermediate care facility for persons with mental 
        retardation or related conditions located in Dakota county that 
        is closing under section 252.292. 
           (b) Notwithstanding the provisions of any other state law 
        or administrative rule, the rate provisions of section 256I.05, 
        subdivision 1, apply to the exception in this subdivision. 
           Sec. 32.  Minnesota Statutes 1998, section 254B.02, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [CHEMICAL DEPENDENCY TREATMENT ALLOCATION.] 
        The chemical dependency funds appropriated for allocation shall 
        be placed in a special revenue account.  The commissioner shall 
        annually transfer funds from the chemical dependency fund to pay 
        for operation of the drug and alcohol abuse normative evaluation 
        system and to pay for all costs incurred by adding two positions 
        for licensing of chemical dependency treatment and 
        rehabilitation programs located in hospitals for which funds are 
        not otherwise appropriated.  For each year of the biennium 
        ending June 30, 1999, the commissioner shall allocate funds to 
        the American Indian chemical dependency tribal account for 
        treatment of American Indians by eligible vendors under section 
        254B.05, equal to the amount allocated in fiscal year 1997.  The 
        commissioner shall annually divide the money available in the 
        chemical dependency fund that is not held in reserve by counties 
        from a previous allocation, or allocated to the American Indian 
        chemical dependency tribal account.  Six percent of the 
        remaining money must be reserved for the nonreservation American 
        Indian chemical dependency allocation for treatment of American 
        Indians by eligible vendors under section 254B.05, subdivision 
        1.  The remainder of the money must be allocated among the 
        counties according to the following formula, using state 
        demographer data and other data sources determined by the 
        commissioner: 
           (a) For purposes of this formula, American Indians and 
        children under age 14 are subtracted from the population of each 
        county to determine the restricted population. 
           (b) The amount of chemical dependency fund expenditures for 
        entitled persons for services not covered by prepaid plans 
        governed by section 256B.69 in the previous year is divided by 
        the amount of chemical dependency fund expenditures for entitled 
        persons for all services to determine the proportion of exempt 
        service expenditures for each county. 
           (c) The prepaid plan months of eligibility is multiplied by 
        the proportion of exempt service expenditures to determine the 
        adjusted prepaid plan months of eligibility for each county. 
           (d) The adjusted prepaid plan months of eligibility is 
        added to the number of restricted population fee for service 
        months of eligibility for aid to families with dependent 
        children, Minnesota family investment program-statewide program, 
        general assistance, and medical assistance and divided by the 
        county restricted population to determine county per capita 
        months of covered service eligibility. 
           (e) The number of adjusted prepaid plan months of 
        eligibility for the state is added to the number of fee for 
        service months of eligibility for aid to families with dependent 
        children, Minnesota family investment program-statewide program, 
        general assistance, and medical assistance for the state 
        restricted population and divided by the state restricted 
        population to determine state per capita months of covered 
        service eligibility. 
           (f) The county per capita months of covered service 
        eligibility is divided by the state per capita months of covered 
        service eligibility to determine the county welfare caseload 
        factor. 
           (g) The median married couple income for the most recent 
        three-year period available for the state is divided by the 
        median married couple income for the same period for each county 
        to determine the income factor for each county. 
           (h) The county restricted population is multiplied by the 
        sum of the county welfare caseload factor and the county income 
        factor to determine the adjusted population. 
           (i) $15,000 shall be allocated to each county.  
           (j) The remaining funds shall be allocated proportional to 
        the county adjusted population. 
           Sec. 33.  Minnesota Statutes 1998, section 256.01, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SPECIFIC POWERS.] Subject to the provisions of 
        section 241.021, subdivision 2, the commissioner of human 
        services shall: 
           (1) Administer and supervise all forms of public assistance 
        provided for by state law and other welfare activities or 
        services as are vested in the commissioner.  Administration and 
        supervision of human services activities or services includes, 
        but is not limited to, assuring timely and accurate distribution 
        of benefits, completeness of service, and quality program 
        management.  In addition to administering and supervising human 
        services activities vested by law in the department, the 
        commissioner shall have the authority to: 
           (a) require county agency participation in training and 
        technical assistance programs to promote compliance with 
        statutes, rules, federal laws, regulations, and policies 
        governing human services; 
           (b) monitor, on an ongoing basis, the performance of county 
        agencies in the operation and administration of human services, 
        enforce compliance with statutes, rules, federal laws, 
        regulations, and policies governing welfare services and promote 
        excellence of administration and program operation; 
           (c) develop a quality control program or other monitoring 
        program to review county performance and accuracy of benefit 
        determinations; 
           (d) require county agencies to make an adjustment to the 
        public assistance benefits issued to any individual consistent 
        with federal law and regulation and state law and rule and to 
        issue or recover benefits as appropriate; 
           (e) delay or deny payment of all or part of the state and 
        federal share of benefits and administrative reimbursement 
        according to the procedures set forth in section 256.017; 
           (f) make contracts with and grants to public and private 
        agencies and organizations, both profit and nonprofit, and 
        individuals, using appropriated funds; and 
           (g) enter into contractual agreements with federally 
        recognized Indian tribes with a reservation in Minnesota to the 
        extent necessary for the tribe to operate a federally approved 
        family assistance program or any other program under the 
        supervision of the commissioner.  The commissioner shall consult 
        with the affected county or counties in the contractual 
        agreement negotiations, if the county or counties wish to be 
        included, in order to avoid the duplication of county and tribal 
        assistance program services.  The commissioner may establish 
        necessary accounts for the purposes of receiving and disbursing 
        funds as necessary for the operation of the programs. 
           (2) Inform county agencies, on a timely basis, of changes 
        in statute, rule, federal law, regulation, and policy necessary 
        to county agency administration of the programs. 
           (3) Administer and supervise all child welfare activities; 
        promote the enforcement of laws protecting handicapped, 
        dependent, neglected and delinquent children, and children born 
        to mothers who were not married to the children's fathers at the 
        times of the conception nor at the births of the children; 
        license and supervise child-caring and child-placing agencies 
        and institutions; supervise the care of children in boarding and 
        foster homes or in private institutions; and generally perform 
        all functions relating to the field of child welfare now vested 
        in the state board of control. 
           (4) Administer and supervise all noninstitutional service 
        to handicapped persons, including those who are visually 
        impaired, hearing impaired, or physically impaired or otherwise 
        handicapped.  The commissioner may provide and contract for the 
        care and treatment of qualified indigent children in facilities 
        other than those located and available at state hospitals when 
        it is not feasible to provide the service in state hospitals. 
           (5) Assist and actively cooperate with other departments, 
        agencies and institutions, local, state, and federal, by 
        performing services in conformity with the purposes of Laws 
        1939, chapter 431. 
           (6) Act as the agent of and cooperate with the federal 
        government in matters of mutual concern relative to and in 
        conformity with the provisions of Laws 1939, chapter 431, 
        including the administration of any federal funds granted to the 
        state to aid in the performance of any functions of the 
        commissioner as specified in Laws 1939, chapter 431, and 
        including the promulgation of rules making uniformly available 
        medical care benefits to all recipients of public assistance, at 
        such times as the federal government increases its participation 
        in assistance expenditures for medical care to recipients of 
        public assistance, the cost thereof to be borne in the same 
        proportion as are grants of aid to said recipients. 
           (7) Establish and maintain any administrative units 
        reasonably necessary for the performance of administrative 
        functions common to all divisions of the department. 
           (8) Act as designated guardian of both the estate and the 
        person of all the wards of the state of Minnesota, whether by 
        operation of law or by an order of court, without any further 
        act or proceeding whatever, except as to persons committed as 
        mentally retarded.  For children under the guardianship of the 
        commissioner whose interests would be best served by adoptive 
        placement, the commissioner may contract with a licensed 
        child-placing agency to provide adoption services.  A contract 
        with a licensed child-placing agency must be designed to 
        supplement existing county efforts and may not replace existing 
        county programs, unless the replacement is agreed to by the 
        county board and the appropriate exclusive bargaining 
        representative or the commissioner has evidence that child 
        placements of the county continue to be substantially below that 
        of other counties. 
           (9) Act as coordinating referral and informational center 
        on requests for service for newly arrived immigrants coming to 
        Minnesota. 
           (10) The specific enumeration of powers and duties as 
        hereinabove set forth shall in no way be construed to be a 
        limitation upon the general transfer of powers herein contained. 
           (11) Establish county, regional, or statewide schedules of 
        maximum fees and charges which may be paid by county agencies 
        for medical, dental, surgical, hospital, nursing and nursing 
        home care and medicine and medical supplies under all programs 
        of medical care provided by the state and for congregate living 
        care under the income maintenance programs. 
           (12) Have the authority to conduct and administer 
        experimental projects to test methods and procedures of 
        administering assistance and services to recipients or potential 
        recipients of public welfare.  To carry out such experimental 
        projects, it is further provided that the commissioner of human 
        services is authorized to waive the enforcement of existing 
        specific statutory program requirements, rules, and standards in 
        one or more counties.  The order establishing the waiver shall 
        provide alternative methods and procedures of administration, 
        shall not be in conflict with the basic purposes, coverage, or 
        benefits provided by law, and in no event shall the duration of 
        a project exceed four years.  It is further provided that no 
        order establishing an experimental project as authorized by the 
        provisions of this section shall become effective until the 
        following conditions have been met: 
           (a) The secretary of health, education, and welfare and 
        human services of the United States has agreed, for the same 
        project, to waive state plan requirements relative to statewide 
        uniformity. 
           (b) A comprehensive plan, including estimated project 
        costs, shall be approved by the legislative advisory commission 
        and filed with the commissioner of administration.  
           (13) According to federal requirements, establish 
        procedures to be followed by local welfare boards in creating 
        citizen advisory committees, including procedures for selection 
        of committee members. 
           (14) Allocate federal fiscal disallowances or sanctions 
        which are based on quality control error rates for the aid to 
        families with dependent children program formerly codified in 
        sections 256.72 to 256.87, Minnesota family investment 
        program-statewide, medical assistance, or food stamp program in 
        the following manner:  
           (a) One-half of the total amount of the disallowance shall 
        be borne by the county boards responsible for administering the 
        programs.  For the medical assistance, MFIP-S, and the AFDC 
        programs program formerly codified in sections 256.72 to 256.87, 
        disallowances shall be shared by each county board in the same 
        proportion as that county's expenditures for the sanctioned 
        program are to the total of all counties' expenditures for the 
        AFDC program formerly codified in sections 256.72 to 
        256.87, MFIP-S, and medical assistance programs.  For the food 
        stamp program, sanctions shall be shared by each county board, 
        with 50 percent of the sanction being distributed to each county 
        in the same proportion as that county's administrative costs for 
        food stamps are to the total of all food stamp administrative 
        costs for all counties, and 50 percent of the sanctions being 
        distributed to each county in the same proportion as that 
        county's value of food stamp benefits issued are to the total of 
        all benefits issued for all counties.  Each county shall pay its 
        share of the disallowance to the state of Minnesota.  When a 
        county fails to pay the amount due hereunder, the commissioner 
        may deduct the amount from reimbursement otherwise due the 
        county, or the attorney general, upon the request of the 
        commissioner, may institute civil action to recover the amount 
        due. 
           (b) Notwithstanding the provisions of paragraph (a), if the 
        disallowance results from knowing noncompliance by one or more 
        counties with a specific program instruction, and that knowing 
        noncompliance is a matter of official county board record, the 
        commissioner may require payment or recover from the county or 
        counties, in the manner prescribed in paragraph (a), an amount 
        equal to the portion of the total disallowance which resulted 
        from the noncompliance, and may distribute the balance of the 
        disallowance according to paragraph (a).  
           (15) Develop and implement special projects that maximize 
        reimbursements and result in the recovery of money to the 
        state.  For the purpose of recovering state money, the 
        commissioner may enter into contracts with third parties.  Any 
        recoveries that result from projects or contracts entered into 
        under this paragraph shall be deposited in the state treasury 
        and credited to a special account until the balance in the 
        account reaches $1,000,000.  When the balance in the account 
        exceeds $1,000,000, the excess shall be transferred and credited 
        to the general fund.  All money in the account is appropriated 
        to the commissioner for the purposes of this paragraph. 
           (16) Have the authority to make direct payments to 
        facilities providing shelter to women and their children 
        according to section 256D.05, subdivision 3.  Upon the written 
        request of a shelter facility that has been denied payments 
        under section 256D.05, subdivision 3, the commissioner shall 
        review all relevant evidence and make a determination within 30 
        days of the request for review regarding issuance of direct 
        payments to the shelter facility.  Failure to act within 30 days 
        shall be considered a determination not to issue direct payments.
           (17) Have the authority to establish and enforce the 
        following county reporting requirements:  
           (a) The commissioner shall establish fiscal and statistical 
        reporting requirements necessary to account for the expenditure 
        of funds allocated to counties for human services programs.  
        When establishing financial and statistical reporting 
        requirements, the commissioner shall evaluate all reports, in 
        consultation with the counties, to determine if the reports can 
        be simplified or the number of reports can be reduced. 
           (b) The county board shall submit monthly or quarterly 
        reports to the department as required by the commissioner.  
        Monthly reports are due no later than 15 working days after the 
        end of the month.  Quarterly reports are due no later than 30 
        calendar days after the end of the quarter, unless the 
        commissioner determines that the deadline must be shortened to 
        20 calendar days to avoid jeopardizing compliance with federal 
        deadlines or risking a loss of federal funding.  Only reports 
        that are complete, legible, and in the required format shall be 
        accepted by the commissioner.  
           (c) If the required reports are not received by the 
        deadlines established in clause (b), the commissioner may delay 
        payments and withhold funds from the county board until the next 
        reporting period.  When the report is needed to account for the 
        use of federal funds and the late report results in a reduction 
        in federal funding, the commissioner shall withhold from the 
        county boards with late reports an amount equal to the reduction 
        in federal funding until full federal funding is received.  
           (d) A county board that submits reports that are late, 
        illegible, incomplete, or not in the required format for two out 
        of three consecutive reporting periods is considered 
        noncompliant.  When a county board is found to be noncompliant, 
        the commissioner shall notify the county board of the reason the 
        county board is considered noncompliant and request that the 
        county board develop a corrective action plan stating how the 
        county board plans to correct the problem.  The corrective 
        action plan must be submitted to the commissioner within 45 days 
        after the date the county board received notice of noncompliance.
           (e) The final deadline for fiscal reports or amendments to 
        fiscal reports is one year after the date the report was 
        originally due.  If the commissioner does not receive a report 
        by the final deadline, the county board forfeits the funding 
        associated with the report for that reporting period and the 
        county board must repay any funds associated with the report 
        received for that reporting period. 
           (f) The commissioner may not delay payments, withhold 
        funds, or require repayment under paragraph (c) or (e) if the 
        county demonstrates that the commissioner failed to provide 
        appropriate forms, guidelines, and technical assistance to 
        enable the county to comply with the requirements.  If the 
        county board disagrees with an action taken by the commissioner 
        under paragraph (c) or (e), the county board may appeal the 
        action according to sections 14.57 to 14.69. 
           (g) Counties subject to withholding of funds under 
        paragraph (c) or forfeiture or repayment of funds under 
        paragraph (e) shall not reduce or withhold benefits or services 
        to clients to cover costs incurred due to actions taken by the 
        commissioner under paragraph (c) or (e). 
           (18) Allocate federal fiscal disallowances or sanctions for 
        audit exceptions when federal fiscal disallowances or sanctions 
        are based on a statewide random sample for the foster care 
        program under title IV-E of the Social Security Act, United 
        States Code, title 42, in direct proportion to each county's 
        title IV-E foster care maintenance claim for that period. 
           (19) Be responsible for ensuring the detection, prevention, 
        investigation, and resolution of fraudulent activities or 
        behavior by applicants, recipients, and other participants in 
        the human services programs administered by the department. 
           (20) Require county agencies to identify overpayments, 
        establish claims, and utilize all available and cost-beneficial 
        methodologies to collect and recover these overpayments in the 
        human services programs administered by the department. 
           (21) Have the authority to administer a drug rebate program 
        for drugs purchased pursuant to the senior citizen drug program 
        established under section 256.955 after the beneficiary's 
        satisfaction of any deductible established in the program.  The 
        commissioner shall require a rebate agreement from all 
        manufacturers of covered drugs as defined in section 256B.0625, 
        subdivision 13.  For each drug, the amount of the rebate shall 
        be equal to the basic rebate as defined for purposes of the 
        federal rebate program in United States Code, title 42, section 
        1396r-8(c)(1).  This basic rebate shall be applied to 
        single-source and multiple-source drugs.  The manufacturers must 
        provide full payment within 30 days of receipt of the state 
        invoice for the rebate within the terms and conditions used for 
        the federal rebate program established pursuant to section 1927 
        of title XIX of the Social Security Act.  The manufacturers must 
        provide the commissioner with any information necessary to 
        verify the rebate determined per drug.  The rebate program shall 
        utilize the terms and conditions used for the federal rebate 
        program established pursuant to section 1927 of title XIX of the 
        Social Security Act. 
           Sec. 34.  Minnesota Statutes 1998, section 256.01, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DUTIES AS STATE AGENCY.] The state agency shall: 
           (1) supervise the administration of assistance to dependent 
        children under Laws 1937, chapter 438, by the county agencies in 
        an integrated program with other service for dependent children 
        maintained under the direction of the state agency; 
           (2) may subpoena witnesses and administer oaths, make 
        rules, and take such action as may be necessary, or desirable 
        for carrying out the provisions of Laws 1937, chapter 438.  All 
        rules made by the state agency shall be binding on the counties 
        and shall be complied with by the respective county agencies; 
           (3) establish adequate standards for personnel employed by 
        the counties and the state agency in the administration of Laws 
        1937, chapter 438, and make the necessary rules to maintain such 
        standards; 
           (4) prescribe the form of and print and supply to the 
        county agencies blanks for applications, reports, affidavits, 
        and such other forms as it may deem necessary and advisable; 
           (5) cooperate with the federal government and its public 
        welfare agencies in any reasonable manner as may be necessary to 
        qualify for federal aid for aid to dependent children temporary 
        assistance for needy families and in conformity with the 
        provisions of Laws 1937, chapter 438 title I of Public Law 
        Number 104-193, the Personal Responsibility and Work Opportunity 
        Reconciliation Act of 1996 and successor amendments, including 
        the making of such reports and such forms and containing such 
        information as the Federal Social Security Board may from time 
        to time require, and comply with such provisions as such board 
        may from time to time find necessary to assure the correctness 
        and verification of such reports; 
           (6) may cooperate with other state agencies in establishing 
        reciprocal agreements in instances where a child receiving aid 
        to dependent children Minnesota family investment program 
        assistance moves or contemplates moving into or out of the 
        state, in order that such child may continue to receive 
        supervised aid from the state moved from until the child shall 
        have resided for one year in the state moved to; 
           (7) on or before October 1 in each even-numbered year make 
        a biennial report to the governor concerning the activities of 
        the agency; and 
           (8) enter into agreements with other departments of the 
        state as necessary to meet all requirements of the federal 
        government. 
           Sec. 35.  Minnesota Statutes 1998, section 256.017, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AUTHORITY AND PURPOSE.] The commissioner 
        shall administer a compliance system for aid to families with 
        dependent children, the Minnesota family investment 
        program-statewide program, the food stamp program, emergency 
        assistance, general assistance, medical assistance, general 
        assistance medical care, emergency general assistance, Minnesota 
        supplemental assistance, preadmission screening, and alternative 
        care grants under the powers and authorities named in section 
        256.01, subdivision 2.  The purpose of the compliance system is 
        to permit the commissioner to supervise the administration of 
        public assistance programs and to enforce timely and accurate 
        distribution of benefits, completeness of service and efficient 
        and effective program management and operations, to increase 
        uniformity and consistency in the administration and delivery of 
        public assistance programs throughout the state, and to reduce 
        the possibility of sanctions and fiscal disallowances for 
        noncompliance with federal regulations and state statutes. 
           The commissioner shall utilize training, technical 
        assistance, and monitoring activities, as specified in section 
        256.01, subdivision 2, to encourage county agency compliance 
        with written policies and procedures. 
           Sec. 36.  Minnesota Statutes 1998, section 256.017, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] The following terms have the 
        meanings given for purposes of this section. 
           (a) "Administrative penalty" means an adjustment against 
        the county agency's state and federal benefit and federal 
        administrative reimbursement when the commissioner determines 
        that the county agency is not in compliance with the policies 
        and procedures established by the commissioner. 
           (b) "Quality control case penalty" means an adjustment 
        against the county agency's federal administrative reimbursement 
        and state and federal benefit reimbursement when the 
        commissioner determines through a quality control review that 
        the county agency has made incorrect payments, terminations, or 
        denials of benefits as determined by state quality control 
        procedures for the aid to families with dependent 
        children program formerly codified in sections 256.72 to 256.87, 
        Minnesota family investment program-statewide program, food 
        stamp, or medical assistance programs, or any other programs for 
        which the commissioner has developed a quality control system.  
        Quality control case penalties apply only to agency errors as 
        defined by state quality control procedures. 
           (c) "Quality control/quality assurance" means a review 
        system of a statewide random sample of cases, designed to 
        provide data on program outcomes and the accuracy with which 
        state and federal policies are being applied in issuing benefits 
        and as a fiscal audit to ensure the accuracy of expenditures.  
        The quality control/quality assurance system is administered by 
        the department.  For the aid to families with dependent children 
        program formerly codified in sections 256.72 to 
        256.87, Minnesota family investment program-statewide, food 
        stamp, and medical assistance programs, the quality control 
        system is that required by federal regulation, or those 
        developed by the commissioner. 
           Sec. 37.  Minnesota Statutes 1998, section 256.017, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DETERMINING THE AMOUNT OF THE QUALITY CONTROL 
        CASE PENALTY.] (a) The amount of the quality control case 
        penalty is limited to the amount of the dollar error for the 
        quality control sample month in a reviewed case as determined by 
        the state quality control review procedures for the aid to 
        families with dependent children program formerly codified in 
        sections 256.72 to 256.87, Minnesota family investment 
        program-statewide and food stamp programs or for any other 
        income transfer program for which the commissioner develops a 
        quality control program. 
           (b) Payment errors in medical assistance or any other 
        medical services program for which the department develops a 
        quality control program are subject to set rate penalties based 
        on the average cost of the specific quality control error 
        element for a sample review month for that household size and 
        status of institutionalization and as determined from state 
        quality control data in the preceding fiscal year for the 
        corresponding program. 
           (c) Errors identified in negative action cases, such as 
        incorrect terminations or denials of assistance are subject to 
        set rate penalties based on the average benefit cost of that 
        household size as determined from state quality control data in 
        the preceding fiscal year for the corresponding program. 
           Sec. 38.  Minnesota Statutes 1998, section 256.019, is 
        amended to read: 
           256.019 [RECOVERY OF MONEY; APPORTIONMENT.] 
           When an amount is recovered from any source for assistance 
        given under the provisions governing public assistance programs 
        including the aid to families with dependent children program 
        formerly codified in sections 256.72 to 256.87, MFIP-S MFIP, 
        general assistance medical care, emergency assistance, general 
        assistance, and Minnesota supplemental aid, the county may keep 
        one-half of recovery made by the county agency using any method 
        other than recoupment.  For medical assistance, if the recovery 
        is made by a county agency using any method other than 
        recoupment, the county may keep one-half of the nonfederal share 
        of the recovery.  This does not apply to recoveries from medical 
        providers or to recoveries begun by the department of human 
        services' surveillance and utilization review division, state 
        hospital collections unit, and the benefit recoveries division 
        or, by the attorney general's office, or child support 
        collections.  In the food stamp program, the nonfederal share of 
        recoveries in the federal tax refund offset program (FTROP) only 
        will be divided equally between the state agency and the 
        involved county agency. 
           Sec. 39.  Minnesota Statutes 1998, section 256.025, 
        subdivision 2, is amended to read: 
           Subd. 2.  [COVERED PROGRAMS AND SERVICES.] The procedures 
        in this section govern payment of county agency expenditures for 
        benefits and services distributed under the following programs: 
           (1) the aid to families with dependent children formerly 
        codified under sections 256.82, subdivision 1, and 256.935, 
        subdivision 1, for assistance costs incurred prior to July 1, 
        1997; 
           (2) medical assistance under sections 256B.041, subdivision 
        5, and 256B.19, subdivision 1; 
           (3) general assistance medical care under section 256D.03, 
        subdivision 6, for assistance costs incurred prior to July 1, 
        1997; 
           (4) general assistance under section 256D.03, subdivision 
        2, for assistance costs incurred prior to July 1, 1997; 
           (5) work readiness under section 256D.03, subdivision 2, 
        for assistance costs incurred prior to July 1, 1995; 
           (6) the emergency assistance formerly codified under 
        section 256.871, subdivision 6, for assistance costs incurred 
        prior to July 1, 1997; 
           (7) Minnesota supplemental aid under section 256D.36, 
        subdivision 1, for assistance costs incurred prior to July 1, 
        1997; 
           (8) preadmission screening and alternative care grants for 
        assistance costs incurred prior to July 1, 1997; 
           (9) work readiness services under section 256D.051 for 
        employment and training services costs incurred prior to July 1, 
        1995; 
           (10) case management services under formerly codified in 
        Minnesota Statutes 1994, section 256.736, subdivision 13 11, for 
        case management service costs incurred prior to July 1, 1995; 
           (11) general assistance claims processing, medical 
        transportation and related costs for costs incurred prior to 
        July 1, 1997; 
           (12) medical transportation and related costs for 
        transportation and related costs incurred prior to July 1, 1997; 
        and 
           (13) group residential housing under section 256I.05, 
        subdivision 8, transferred from programs in clauses (4) and (7), 
        for assistance costs incurred prior to July 1, 1997. 
           Sec. 40.  Minnesota Statutes 1998, section 256.046, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [HEARING AUTHORITY.] A local agency shall 
        initiate an administrative fraud disqualification hearing for 
        individuals accused of wrongfully obtaining assistance or 
        intentional program violations, in lieu of a criminal action 
        when it has not been pursued, in the aid to families with 
        dependent children program formerly codified in sections 256.72 
        to 256.87, MFIP-S MFIP, child care, general assistance, family 
        general assistance program formerly codified in section 256D.05, 
        subdivision 1, clause (15), Minnesota supplemental aid, medical 
        care, or food stamp programs.  The hearing is subject to the 
        requirements of section 256.045 and the requirements in Code of 
        Federal Regulations, title 7, section 273.16, for the food stamp 
        program and title 45, section 235.112, as of September 30, 1995, 
        for the cash grant and medical care programs. 
           Sec. 41.  Minnesota Statutes 1998, section 256.0471, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [QUALIFYING OVERPAYMENT.] Any overpayment 
        for assistance granted under sections section 119B.05, the MFIP 
        program formerly codified under sections 256.031 to 256.0361, 
        and the AFDC program formerly codified under sections 256.72 to 
        256.871; chapters 256B, 256D, 256I, 256J, and 256K; and the food 
        stamp program, except agency error claims, become a judgment by 
        operation of law 90 days after the notice of overpayment is 
        personally served upon the recipient in a manner that is 
        sufficient under rule 4.03(a) of the Rules of Civil Procedure 
        for district courts, or by certified mail, return receipt 
        requested.  This judgment shall be entitled to full faith and 
        credit in this and any other state. 
           Sec. 42.  Minnesota Statutes 1998, section 256.741, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PUBLIC ASSISTANCE.] (a) The term "public 
        assistance" as used in this chapter and chapters 257, 518, and 
        518C, includes any form of assistance provided under the AFDC 
        program formerly codified in sections 256.72 to 256.87, MFIP, 
        and MFIP-R formerly codified under chapter 256, MFIP-S MFIP 
        under chapter 256J, and work first program under chapter 256K; 
        child care assistance provided through the child care 
        fund according to under chapter 119B; any form of medical 
        assistance under chapter 256B; MinnesotaCare under chapter 256L; 
        and foster care as provided under title IV-E of the Social 
        Security Act. 
           (b) The term "child support agency" as used in this section 
        refers to the public authority responsible for child support 
        enforcement. 
           (c) The term "public assistance agency" as used in this 
        section refers to a public authority providing public assistance 
        to an individual. 
           Sec. 43.  Minnesota Statutes 1998, section 256.741, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ASSIGNMENT OF SUPPORT AND MAINTENANCE RIGHTS.] 
        (a) An individual receiving public assistance in the form of 
        assistance under any of the following programs:  the AFDC 
        program formerly codified in sections 256.72 to 256.87, MFIP-S 
        MFIP under chapter 256J, MFIP-R, and MFIP formerly codified 
        under chapter 256, and or work first is considered to have 
        assigned to the state at the time of application all rights to 
        child support and maintenance from any other person the 
        applicant or recipient may have in the individual's own behalf 
        or in the behalf of any other family member for whom application 
        for public assistance is made.  An assistance unit is ineligible 
        for aid to families with dependent children or its successor the 
        Minnesota family investment program unless the caregiver assigns 
        all rights to child support and spousal maintenance benefits 
        according to this section. 
           (1) An assignment made according to this section is 
        effective as to: 
           (i) any current child support and current spousal 
        maintenance; and 
           (ii) any accrued child support and spousal maintenance 
        arrears. 
           (2) An assignment made after September 30, 1997, is 
        effective as to: 
           (i) any current child support and current spousal 
        maintenance; 
           (ii) any accrued child support and spousal maintenance 
        arrears collected before October 1, 2000, or the date the 
        individual terminates assistance, whichever is later; and 
           (iii) any accrued child support and spousal maintenance 
        arrears collected under federal tax intercept. 
           (b) An individual receiving public assistance in the form 
        of medical assistance, including MinnesotaCare, is considered to 
        have assigned to the state at the time of application all rights 
        to medical support from any other person the individual may have 
        in the individual's own behalf or in the behalf of any other 
        family member for whom medical assistance is provided. 
           An assignment made after September 30, 1997, is effective 
        as to any medical support accruing after the date of medical 
        assistance or MinnesotaCare eligibility. 
           (c) An individual receiving public assistance in the form 
        of child care assistance under the child care fund pursuant to 
        chapter 119B is considered to have assigned to the state at the 
        time of application all rights to child care support from any 
        other person the individual may have in the individual's own 
        behalf or in the behalf of any other family member for whom 
        child care assistance is provided. 
           An assignment made according to this paragraph is effective 
        as to: 
           (1) any current child care support and any child care 
        support arrears assigned and accruing after July 1, 1997, that 
        are collected before October 1, 2000; and 
           (2) any accrued child care support arrears collected under 
        federal tax intercept. 
           Sec. 44.  Minnesota Statutes 1998, section 256.82, 
        subdivision 2, is amended to read: 
           Subd. 2.  [FOSTER CARE MAINTENANCE PAYMENTS.] 
        Notwithstanding subdivision 1, for the purposes of foster care 
        maintenance payments under title IV-E of the federal Social 
        Security Act, United States Code, title 42, sections 670 to 676, 
        during the period beginning July 1, 1985, and ending December 
        31, 1985, the county paying the maintenance costs shall be 
        reimbursed for the costs from those federal funds available for 
        that purpose together with an amount of state funds equal to a 
        percentage of the difference between the total cost and the 
        federal funds made available for payment.  This percentage shall 
        not exceed the percentage specified in subdivision 1 for the aid 
        to families with dependent children program.  In the event that 
        the state appropriation for this purpose is less than the state 
        percentage set in subdivision 1, the reimbursement shall be 
        ratably reduced to the county.  Beginning January 1, 1986, for 
        the purpose of foster care maintenance payments under title IV-E 
        of the Social Security Act, United States Code, title 42, 
        sections 670 to 676, the county paying the maintenance costs 
        must be reimbursed for the costs from the federal money 
        available for the purpose.  Beginning July 1, 1997, for the 
        purposes of determining a child's eligibility under title IV-E 
        of the Social Security Act, the placing agency shall use AFDC 
        requirements in effect on July 16, 1996. 
           Sec. 45.  Minnesota Statutes 1998, section 256.935, 
        subdivision 1, is amended to read: 
           Subdivision 1.  On the death of any person receiving public 
        assistance through aid to dependent children or MFIP-S MFIP, the 
        county agency shall pay an amount for funeral expenses not 
        exceeding the amount paid for comparable services under section 
        261.035 plus actual cemetery charges.  No funeral expenses shall 
        be paid if the estate of the deceased is sufficient to pay such 
        expenses or if the spouse, who was legally responsible for the 
        support of the deceased while living, is able to pay such 
        expenses; provided, that the additional payment or donation of 
        the cost of cemetery lot, interment, religious service, or for 
        the transportation of the body into or out of the community in 
        which the deceased resided, shall not limit payment by the 
        county agency as herein authorized.  Freedom of choice in the 
        selection of a funeral director shall be granted to persons 
        lawfully authorized to make arrangements for the burial of any 
        such deceased recipient.  In determining the sufficiency of such 
        estate, due regard shall be had for the nature and marketability 
        of the assets of the estate.  The county agency may grant 
        funeral expenses where the sale would cause undue loss to the 
        estate.  Any amount paid for funeral expenses shall be a prior 
        claim against the estate, as provided in section 524.3-805, and 
        any amount recovered shall be reimbursed to the agency which 
        paid the expenses.  The commissioner shall specify requirements 
        for reports, including fiscal reports, according to section 
        256.01, subdivision 2, paragraph (17).  The state share shall 
        pay the entire amount of county agency expenditures.  Benefits 
        shall be issued to recipients by the state or county subject to 
        provisions of section 256.017. 
           Sec. 46.  Minnesota Statutes 1998, section 256.98, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [WRONGFULLY OBTAINING ASSISTANCE.] A person 
        who commits any of the following acts or omissions with intent 
        to defeat the purposes of sections 145.891 to 145.897, 
        256.12, the MFIP program formerly codified in sections 256.031 
        to 256.361 256.0361, the AFDC program formerly codified in 
        sections 256.72 to 256.871, 256.9365, 256.94 to 256.966, child 
        care, MFIP-S, chapter and chapters 256B, 256D, 256J, 256K, or 
        256L, or all of these sections, is guilty of theft and shall be 
        sentenced under section 609.52, subdivision 3, clauses (1) to 
        (5): 
           (1) obtains or attempts to obtain, or aids or abets any 
        person to obtain by means of a willfully false statement or 
        representation, by intentional concealment of any material fact, 
        or by impersonation or other fraudulent device, assistance or 
        the continued receipt of assistance, to include child care or 
        vouchers produced according to sections 145.891 to 145.897 and 
        MinnesotaCare services according to sections 256.9365, 256.94, 
        and 256L.01 to 256L.16, to which the person is not entitled or 
        assistance greater than that to which the person is entitled; 
           (2) knowingly aids or abets in buying or in any way 
        disposing of the property of a recipient or applicant of 
        assistance without the consent of the county agency. 
           The continued receipt of assistance to which the person is 
        not entitled or greater than that to which the person is 
        entitled as a result of any of the acts, failure to act, or 
        concealment described in this subdivision shall be deemed to be 
        continuing offenses from the date that the first act or failure 
        to act occurred. 
           Sec. 47.  Minnesota Statutes 1998, section 256.98, 
        subdivision 8, is amended to read: 
           Subd. 8.  [DISQUALIFICATION FROM PROGRAM.] Any person found 
        to be guilty of wrongfully obtaining assistance by a federal or 
        state court or by an administrative hearing determination, or 
        waiver thereof, through a disqualification consent agreement, or 
        as part of any approved diversion plan under section 401.065, or 
        any court-ordered stay which carries with it any probationary or 
        other conditions, in the aid to families with dependent children 
        program, the Minnesota family assistance program-statewide 
        program, the food stamp program, the Minnesota family investment 
        plan, child care program, the general assistance or family 
        general assistance program, or the Minnesota supplemental aid 
        program shall be disqualified from that program.  The needs of 
        that individual shall not be taken into consideration in 
        determining the grant level for that assistance unit:  
           (1) for one year after the first offense; 
           (2) for two years after the second offense; and 
           (3) permanently after the third or subsequent offense.  
           The period of program disqualification shall begin on the 
        date stipulated on the advance notice of disqualification 
        without possibility of postponement for administrative stay or 
        administrative hearing and shall continue through completion 
        unless and until the findings upon which the sanctions were 
        imposed are reversed by a court of competent jurisdiction.  The 
        period for which sanctions are imposed is not subject to 
        review.  The sanctions provided under this subdivision are in 
        addition to, and not in substitution for, any other sanctions 
        that may be provided for by law for the offense involved.  A 
        disqualification established through hearing or waiver shall 
        result in the disqualification period beginning immediately 
        unless the person has become otherwise ineligible for 
        assistance.  If the person is ineligible for assistance, the 
        disqualification period begins when the person again meets the 
        eligibility criteria of the program from which they were 
        disqualified and makes application for that program. 
           Sec. 48.  Minnesota Statutes 1998, section 256.981, is 
        amended to read: 
           256.981 [TRAINING OF WELFARE FRAUD PROSECUTORS.] 
           The commissioner of human services shall, to the extent an 
        appropriation is provided for this purpose, contract with the 
        county attorney's council or other public or private entity 
        experienced in providing training for prosecutors to conduct 
        quarterly workshops and seminars focusing on current aid to 
        families with dependent children and Minnesota family investment 
        program-statewide program issues, other income maintenance 
        program changes, recovery issues, alternative sentencing 
        methods, use of technical aids for interviews and 
        interrogations, and other matters affecting prosecution of 
        welfare fraud cases. 
           Sec. 49.  Minnesota Statutes 1998, section 256.983, 
        subdivision 4, is amended to read: 
           Subd. 4.  [FUNDING.] (a) County agency reimbursement shall 
        be made through the settlement provisions applicable to the aid 
        to families with dependent children program formerly codified in 
        sections 256.72 to 256.87, food stamp program, Minnesota family 
        investment program-statewide program, and medical assistance 
        program and other federal and state-funded programs. 
           (b) The commissioner will maintain program compliance if 
        for any three consecutive month period, a county agency fails to 
        comply with fraud prevention investigation program guidelines, 
        or fails to meet the cost-effectiveness standards developed by 
        the commissioner.  This result is contingent on the commissioner 
        providing written notice, including an offer of technical 
        assistance, within 30 days of the end of the third or subsequent 
        month of noncompliance.  The county agency shall be required to 
        submit a corrective action plan to the commissioner within 30 
        days of receipt of a notice of noncompliance.  Failure to submit 
        a corrective action plan or, continued deviation from standards 
        of more than ten percent after submission of a corrective action 
        plan, will result in denial of funding for each subsequent 
        month, or billing the county agency for fraud prevention 
        investigation (FPI) service provided by the commissioner, or 
        reallocation of program grant funds, or investigative resources, 
        or both, to other counties.  The denial of funding shall apply 
        to the general settlement received by the county agency on a 
        quarterly basis and shall not reduce the grant amount applicable 
        to the FPI project.  
           Sec. 50.  Minnesota Statutes 1998, section 256.9861, 
        subdivision 5, is amended to read: 
           Subd. 5.  [FUNDING.] (a) State funding shall be made 
        available contingent on counties submitting a plan that is 
        approved by the department of human services.  Failure or delay 
        in obtaining that approval shall not, however, eliminate the 
        obligation to maintain fraud control efforts at the June 30, 
        1996, level.  County agency reimbursement shall be made through 
        the settlement provisions applicable to the AFDC, MFIP-S MFIP, 
        food stamp, and medical assistance programs.  
           (b) Should a county agency fail to comply with the 
        standards set, or fail to meet cost-effectiveness standards 
        developed by the commissioner for any three-month period, the 
        commissioner shall deny reimbursement or administrative costs, 
        after allowing an opportunity to establish compliance.  
           (c) Any denial of reimbursement under paragraph (b) is 
        contingent on the commissioner providing written notice, 
        including an offer of technical assistance, within 30 days of 
        the end of the third or subsequent months of noncompliance.  The 
        county agency shall be required to submit a corrective action 
        plan to the commissioner within 30 days of receipt of a notice 
        of noncompliance.  Failure to submit a corrective action plan or 
        continued deviation from standards of more than ten percent 
        after submission of corrective action plan, will result in 
        denial of funding for each such month during the grant year, or 
        billing of the county agency for program integrity reinvestment 
        project services provided by the commissioner or reallocation of 
        grant funds to other counties.  The denial of funding shall 
        apply to the general settlement received by the county agency on 
        a quarterly basis and shall not reduce the grant amount 
        applicable to the program integrity reinvestment project. 
           Sec. 51.  Minnesota Statutes 1998, section 256B.031, 
        subdivision 4, is amended to read: 
           Subd. 4.  [PREPAID HEALTH PLAN RATES.] For payments made 
        during calendar year 1988, the monthly maximum allowable rate 
        established by the commissioner of human services for payment to 
        prepaid health plans must not exceed 90 percent of the projected 
        average monthly per capita fee-for-service medical assistance 
        costs for state fiscal year 1988 for recipients of the aid to 
        families with dependent children program formerly codified in 
        sections 256.72 to 256.87.  The base year for projecting the 
        average monthly per capita fee-for-service medical assistance 
        costs is state fiscal year 1986.  A maximum allowable per capita 
        rate must be established collectively for Anoka, Carver, Dakota, 
        Hennepin, Ramsey, St. Louis, Scott, and Washington counties.  A 
        separate maximum allowable per capita rate must be established 
        collectively for all other counties.  The maximum allowable per 
        capita rate may be adjusted to reflect utilization differences 
        among eligible classes of recipients.  For payments made during 
        calendar year 1989, the maximum allowable rate must be 
        calculated in the same way as 1988 rates, except the base year 
        is state fiscal year 1987.  For payments made during calendar 
        year 1990 and later years, the commissioner shall consult with 
        an independent actuary in establishing prepayment rates, but 
        shall retain final control over the rate methodology.  Rates 
        established for prepaid health plans must be based on the 
        services that the prepaid health plan provides under contract 
        with the commissioner.  
           Sec. 52.  Minnesota Statutes 1998, section 256B.031, 
        subdivision 5, is amended to read: 
           Subd. 5.  [FREE CHOICE LIMITED.] (a) The commissioner may 
        require recipients of aid to families with dependent 
        children the Minnesota family investment program to enroll in a 
        prepaid health plan and receive services from or through the 
        prepaid health plan, with the following exceptions: 
           (1) recipients who are refugees and whose health services 
        are reimbursed 100 percent by the federal government; and 
           (2) recipients who are placed in a foster home or 
        facility.  If placement occurs before the seventh day prior to 
        the end of any month, the recipient will be disenrolled from the 
        recipient's prepaid health plan effective the first day of the 
        following month.  If placement occurs after the seventh day 
        before the end of any month, that recipient will be disenrolled 
        from the prepaid health plan on the first day of the second 
        month following placement.  The prepaid health plan must provide 
        all services set forth in subdivision 2 during the interim 
        period. 
           Enrollment in a prepaid health plan is mandatory only when 
        recipients have a choice of at least two prepaid health plans.  
           (b) Recipients who become eligible on or after December 1, 
        1987, must choose a health plan within 30 days of the date 
        eligibility is determined.  At the time of application, the 
        local agency shall ask the recipient whether the recipient has a 
        primary health care provider.  If the recipient has not chosen a 
        health plan within 30 days but has provided the local agency 
        with the name of a primary health care provider, the local 
        agency shall determine whether the provider participates in a 
        prepaid health plan available to the recipient and, if so, the 
        local agency shall select that plan on the recipient's behalf.  
        If the recipient has not provided the name of a primary health 
        care provider who participates in an available prepaid health 
        plan, commissioner shall randomly assign the recipient to a 
        health plan.  
           (c) If possible, the local agency shall ask whether the 
        recipient has a primary health care provider and the procedures 
        under paragraph (b) shall apply.  If a recipient does not choose 
        a prepaid health plan by this date, the commissioner shall 
        randomly assign the recipient to a health plan.  
           (d) The commissioner shall request a waiver from the 
        federal Health Care Financing Administration to limit a 
        recipient's ability to change health plans to once every six or 
        12 months.  If such a waiver is obtained, each recipient must be 
        enrolled in the health plan for a minimum of six or 12 months.  
        A recipient may change health plans once within the first 60 
        days after initial enrollment. 
           (e) Women who are receiving medical assistance due to 
        pregnancy and later become eligible for aid to families with 
        dependent children the Minnesota family investment program are 
        not required to choose a prepaid health plan until 60 days 
        postpartum.  An infant born as a result of that pregnancy must 
        be enrolled in a prepaid health plan at the same time as the 
        mother. 
           (f) If third-party coverage is available to a recipient 
        through enrollment in a prepaid health plan through employment, 
        through coverage by the former spouse, or if a duty of support 
        has been imposed by law, order, decree, or judgment of a court 
        under section 518.551, the obligee or recipient shall 
        participate in the prepaid health plan in which the obligee has 
        enrolled provided that the commissioner has contracted with the 
        plan. 
           Sec. 53.  Minnesota Statutes 1998, section 256B.69, 
        subdivision 5a, is amended to read: 
           Subd. 5a.  [MANAGED CARE CONTRACTS.] Managed care contracts 
        under this section, and sections 256.9363, 256L.12 and 256D.03, 
        shall be entered into or renewed on a calendar year basis 
        beginning January 1, 1996.  Managed care contracts which were in 
        effect on June 30, 1995, and set to renew on July 1, 1995, shall 
        be renewed for the period July 1, 1995 through December 31, 1995 
        at the same terms that were in effect on June 30, 1995. 
           Sec. 54.  Minnesota Statutes 1998, section 256C.21, is 
        amended to read: 
           256C.21 [DEAF AND HARD-OF-HEARING SERVICES ACT; CITATION.] 
           Sections 256C.21 to 256C.27 256C.26 may be cited as the 
        "Deaf and Hard-of-Hearing Services Act."  
           Sec. 55.  Minnesota Statutes 1998, section 256C.23, 
        subdivision 1, is amended to read: 
           Subdivision 1.  For the purposes of sections 256C.21 to 
        256C.27 256C.26, the terms defined in this section shall have 
        the meanings given them, unless the context clearly indicates 
        otherwise.  
           Sec. 56.  Minnesota Statutes 1998, section 256D.01, 
        subdivision 1a, is amended to read: 
           Subd. 1a.  [STANDARDS.] (a) A principal objective in 
        providing general assistance is to provide for single adults, 
        childless couples, or children as defined in section 256D.02, 
        subdivision 6, ineligible for federal programs who are unable to 
        provide for themselves.  The minimum standard of assistance 
        determines the total amount of the general assistance grant 
        without separate standards for shelter, utilities, or other 
        needs. 
           (b) The commissioner shall set the standard of assistance 
        for an assistance unit consisting of an adult recipient who is 
        childless and unmarried or living apart from children and spouse 
        and who does not live with a parent or parents or a legal 
        custodian.  When the other standards specified in this 
        subdivision increase, this standard must also be increased by 
        the same percentage. 
           (c) For an assistance unit consisting of a single adult who 
        lives with a parent or parents, the general assistance standard 
        of assistance is the amount that the aid to families with 
        dependent children standard of assistance, in effect on July 16, 
        1996, would increase if the recipient were added as an 
        additional minor child to an assistance unit consisting of the 
        recipient's parent and all of that parent's family members, 
        except that the standard may not exceed the standard for a 
        general assistance recipient living alone.  Benefits received by 
        a responsible relative of the assistance unit under the 
        supplemental security income program, a workers' compensation 
        program, the Minnesota supplemental aid program, or any other 
        program based on the responsible relative's disability, and any 
        benefits received by a responsible relative of the assistance 
        unit under the social security retirement program, may not be 
        counted in the determination of eligibility or benefit level for 
        the assistance unit.  Except as provided below, the assistance 
        unit is ineligible for general assistance if the available 
        resources or the countable income of the assistance unit and the 
        parent or parents with whom the assistance unit lives are such 
        that a family consisting of the assistance unit's parent or 
        parents, the parent or parents' other family members and the 
        assistance unit as the only or additional minor child would be 
        financially ineligible for general assistance.  For the purposes 
        of calculating the countable income of the assistance unit's 
        parent or parents, the calculation methods, income deductions, 
        exclusions, and disregards used when calculating the countable 
        income for a single adult or childless couple must be used. 
           (d) For an assistance unit consisting of a childless 
        couple, the standards of assistance are the same as the first 
        and second adult standards of the aid to families with dependent 
        children program in effect on July 16, 1996.  If one member of 
        the couple is not included in the general assistance grant, the 
        standard of assistance for the other is the second adult 
        standard of the aid to families with dependent children 
        program as of July 16, 1996. 
           Sec. 57.  Minnesota Statutes 1998, section 256D.01, 
        subdivision 1e, is amended to read: 
           Subd. 1e.  [RULES REGARDING EMERGENCY ASSISTANCE.] The 
        commissioner shall adopt rules under the terms of sections 
        256D.01 to 256D.21 for general assistance, to require use of the 
        emergency program under aid to families with dependent children 
        or MFIP-S MFIP as the primary financial resource when available. 
        The commissioner shall adopt rules for eligibility for general 
        assistance of persons with seasonal income and may attribute 
        seasonal income to other periods not in excess of one year from 
        receipt by an applicant or recipient.  General assistance 
        payments may not be made for foster care, child welfare 
        services, or other social services.  Vendor payments and 
        vouchers may be issued only as authorized in sections 256D.05, 
        subdivision 6, and 256D.09. 
           Sec. 58.  Minnesota Statutes 1998, section 256D.05, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ELIGIBILITY.] (a) Each assistance unit 
        with income and resources less than the standard of assistance 
        established by the commissioner and with a member who is a 
        resident of the state shall be eligible for and entitled to 
        general assistance if the assistance unit is: 
           (1) a person who is suffering from a professionally 
        certified permanent or temporary illness, injury, or incapacity 
        which is expected to continue for more than 30 days and which 
        prevents the person from obtaining or retaining employment; 
           (2) a person whose presence in the home on a substantially 
        continuous basis is required because of the professionally 
        certified illness, injury, incapacity, or the age of another 
        member of the household; 
           (3) a person who has been placed in, and is residing in, a 
        licensed or certified facility for purposes of physical or 
        mental health or rehabilitation, or in an approved chemical 
        dependency domiciliary facility, if the placement is based on 
        illness or incapacity and is according to a plan developed or 
        approved by the county agency through its director or designated 
        representative; 
           (4) a person who resides in a shelter facility described in 
        subdivision 3; 
           (5) a person not described in clause (1) or (3) who is 
        diagnosed by a licensed physician, psychological practitioner, 
        or other qualified professional, as mentally retarded or 
        mentally ill, and that condition prevents the person from 
        obtaining or retaining employment; 
           (6) a person who has an application pending for, or is 
        appealing termination of benefits from, the social security 
        disability program or the program of supplemental security 
        income for the aged, blind, and disabled, provided the person 
        has a professionally certified permanent or temporary illness, 
        injury, or incapacity which is expected to continue for more 
        than 30 days and which prevents the person from obtaining or 
        retaining employment; 
           (7) a person who is unable to obtain or retain employment 
        because advanced age significantly affects the person's ability 
        to seek or engage in substantial work; 
           (8) a person who has been assessed by a vocational 
        specialist and, in consultation with the county agency, has been 
        determined to be unemployable for purposes of this clause; a 
        person is considered employable if there exist positions of 
        employment in the local labor market, regardless of the current 
        availability of openings for those positions, that the person is 
        capable of performing.  The person's eligibility under this 
        category must be reassessed at least annually.  The county 
        agency must provide notice to the person not later than 30 days 
        before annual eligibility under this item ends, informing the 
        person of the date annual eligibility will end and the need for 
        vocational assessment if the person wishes to continue 
        eligibility under this clause.  For purposes of establishing 
        eligibility under this clause, it is the applicant's or 
        recipient's duty to obtain any needed vocational assessment; 
           (9) a person who is determined by the county agency, 
        according to permanent rules adopted by the commissioner, to be 
        learning disabled, provided that if a rehabilitation plan for 
        the person is developed or approved by the county agency, the 
        person is following the plan; 
           (10) a child under the age of 18 who is not living with a 
        parent, stepparent, or legal custodian, and only if:  the child 
        is legally emancipated or living with an adult with the consent 
        of an agency acting as a legal custodian; the child is at least 
        16 years of age and the general assistance grant is approved by 
        the director of the county agency or a designated representative 
        as a component of a social services case plan for the child; or 
        the child is living with an adult with the consent of the 
        child's legal custodian and the county agency.  For purposes of 
        this clause, "legally emancipated" means a person under the age 
        of 18 years who:  (i) has been married; (ii) is on active duty 
        in the uniformed services of the United States; (iii) has been 
        emancipated by a court of competent jurisdiction; or (iv) is 
        otherwise considered emancipated under Minnesota law, and for 
        whom county social services has not determined that a social 
        services case plan is necessary, for reasons other than the 
        child has failed or refuses to cooperate with the county agency 
        in developing the plan; 
           (11) until March 31, 1998, a woman in the last trimester of 
        pregnancy who does not qualify for aid to families with 
        dependent children.  A woman who is in the last trimester of 
        pregnancy who is currently receiving aid to families with 
        dependent children may be granted emergency general assistance 
        to meet emergency needs; 
           (12) a person who is eligible for displaced homemaker 
        services, programs, or assistance under section 268.96, but only 
        if that person is enrolled as a full-time student; 
           (13) (12) a person who lives more than four hours 
        round-trip traveling time from any potential suitable 
        employment; 
           (14) (13) a person who is involved with protective or 
        court-ordered services that prevent the applicant or recipient 
        from working at least four hours per day; 
           (15)(i) until March 31, 1998, a family as defined in 
        section 256D.02, subdivision 5, which is ineligible for the aid 
        to families with dependent children program; 
           (ii) unless exempt under section 256D.051, subdivision 3a, 
        each adult in the unit must participate in and cooperate with 
        the food stamp employment and training program under section 
        256D.051 each month that the unit receives general assistance 
        benefits.  The recipient's participation must begin no later 
        than the first day of the first full month following the 
        determination of eligibility for general assistance benefits.  
        To the extent of available resources, and with the county 
        agency's consent, the recipient may voluntarily continue to 
        participate in food stamp employment and training services for 
        up to three additional consecutive months immediately following 
        termination of general assistance benefits in order to complete 
        the provisions of the recipient's employability development 
        plan.  If an adult member fails without good cause to 
        participate in or cooperate with the food stamp employment and 
        training program, the county agency shall concurrently terminate 
        that person's eligibility for general assistance and food stamps 
        using the notice, good cause, conciliation and termination 
        procedures specified in section 256D.051; 
           (16) (14) a person over age 18 whose primary language is 
        not English and who is attending high school at least half time; 
        or 
           (17) (15) a person whose alcohol and drug addiction is a 
        material factor that contributes to the person's disability; 
        applicants who assert this clause as a basis for eligibility 
        must be assessed by the county agency to determine if they are 
        amenable to treatment; if the applicant is determined to be not 
        amenable to treatment, but is otherwise eligible for benefits, 
        then general assistance must be paid in vendor form, for the 
        individual's shelter costs up to the limit of the grant amount, 
        with the residual, if any, paid according to section 256D.09, 
        subdivision 2a; if the applicant is determined to be amenable to 
        treatment, then in order to receive benefits, the applicant must 
        be in a treatment program or on a waiting list and the benefits 
        must be paid in vendor form, for the individual's shelter costs, 
        up to the limit of the grant amount, with the residual, if any, 
        paid according to section 256D.09, subdivision 2a. 
           (b) As a condition of eligibility under paragraph (a), 
        clauses (1), (3), (5), (8), and (9), the recipient must complete 
        an interim assistance agreement and must apply for other 
        maintenance benefits as specified in section 256D.06, 
        subdivision 5, and must comply with efforts to determine the 
        recipient's eligibility for those other maintenance benefits.  
           (c) The burden of providing documentation for a county 
        agency to use to verify eligibility for general assistance or 
        for exemption from the food stamp employment and training 
        program is upon the applicant or recipient.  The county agency 
        shall use documents already in its possession to verify 
        eligibility, and shall help the applicant or recipient obtain 
        other existing verification necessary to determine eligibility 
        which the applicant or recipient does not have and is unable to 
        obtain. 
           Sec. 59.  Minnesota Statutes 1998, section 256D.05, 
        subdivision 3, is amended to read: 
           Subd. 3.  [RESIDENTS OF SHELTER FACILITIES.] 
        Notwithstanding the provisions of subdivisions 1 and 2, general 
        assistance payments shall be made for maintenance costs and 
        security costs which are related to providing 24-hour staff 
        coverage at the facility incurred as a result of residence in a 
        secure crisis shelter, a housing network, or other shelter 
        facilities which provide shelter services to women and their 
        children who are being or have been assaulted by their spouses, 
        other male relatives, or other males with whom they are residing 
        or have resided in the past. 
           These payments shall be made directly to the shelter 
        facility from general assistance funds on behalf of women and 
        their children who are receiving, or who are eligible to 
        receive, aid to families with dependent children Minnesota 
        family investment program or general assistance.  
           In determining eligibility of women and children for 
        payment of general assistance under this subdivision, the asset 
        limitations of the aid to families with dependent children 
        Minnesota family investment program shall be applied.  Payments 
        to shelter facilities shall not affect the eligibility of 
        individuals who reside in shelter facilities for aid to families 
        with dependent children Minnesota family investment program or 
        general assistance or payments made to individuals who reside in 
        shelter facilities through aid to families with dependent 
        children Minnesota family investment program or general 
        assistance, except when required by federal law or regulation.  
           Sec. 60.  Minnesota Statutes 1998, section 256D.05, 
        subdivision 5, is amended to read: 
           Subd. 5.  [TRANSFERS OF PROPERTY.] The equity value of real 
        and personal property transferred without reasonable 
        compensation within 12 months preceding the date of application 
        for general assistance must be included in determining the 
        resources of an assistance unit in the same manner as in the aid 
        to families with dependent children program under chapter 256 or 
        MFIP-S MFIP under chapter 256J. 
           Sec. 61.  Minnesota Statutes 1998, section 256D.051, 
        subdivision 3a, is amended to read: 
           Subd. 3a.  [PERSONS REQUIRED TO REGISTER FOR AND 
        PARTICIPATE IN THE FOOD STAMP EMPLOYMENT AND TRAINING PROGRAM.] 
        (a) To the extent required under Code of Federal Regulations, 
        title 7, section 273.7(a), each applicant for and recipient of 
        food stamps is required to register for work as a condition of 
        eligibility for food stamp benefits.  Applicants and recipients 
        are registered by signing an application or annual reapplication 
        for food stamps, and must be informed that they are registering 
        for work by signing the form.  
           (b) The commissioner shall determine, within federal 
        requirements, persons required to participate in the food stamp 
        employment and training (FSET) program. 
           (c) The following food stamp recipients are exempt from 
        mandatory participation in food stamp employment and training 
        services: 
           (1) recipients of benefits under the AFDC program, the 
        MFIP-S, MFIP, and MFIP-R programs program, Minnesota 
        supplemental aid program, or the general assistance program; 
           (2) a child; 
           (3) a recipient over age 55; 
           (4) a recipient who has a mental or physical illness, 
        injury, or incapacity which is expected to continue for at least 
        30 days and which impairs the recipient's ability to obtain or 
        retain employment as evidenced by professional certification or 
        the receipt of temporary or permanent disability benefits issued 
        by a private or government source; 
           (5) a parent or other household member responsible for the 
        care of either a dependent child in the household who is under 
        age six or a person in the household who is professionally 
        certified as having a physical or mental illness, injury, or 
        incapacity.  Only one parent or other household member may claim 
        exemption under this provision; 
           (6) a recipient receiving unemployment compensation or who 
        has applied for unemployment compensation and has been required 
        to register for work with the department of economic security as 
        part of the unemployment compensation application process; 
           (7) a recipient participating each week in a drug addiction 
        or alcohol abuse treatment and rehabilitation program, provided 
        the operators of the treatment and rehabilitation program, in 
        consultation with the county agency, recommend that the 
        recipient not participate in the food stamp employment and 
        training program; 
           (8) a recipient employed or self-employed for 30 or more 
        hours per week at employment paying at least minimum wage, or 
        who earns wages from employment equal to or exceeding 30 hours 
        multiplied by the federal minimum wage; or 
           (9) a student enrolled at least half time in any school, 
        training program, or institution of higher education.  When 
        determining if a student meets this criteria, the school's, 
        program's or institution's criteria for being enrolled half time 
        shall be used. 
           Sec. 62.  Minnesota Statutes 1998, section 256D.055, is 
        amended to read: 
           256D.055 [COUNTY DESIGN; WORK FOCUSED PROGRAM.] 
           The commissioner of human services shall issue a request 
        for proposals from counties to submit a plan for developing and 
        implementing a county-designed program.  The plan shall be for 
        first-time applicants for Minnesota family investment 
        program-statewide (MFIP-S) and, until March 31, 1998, aid to 
        families with dependent children and family general assistance 
        program and must emphasize the importance of becoming employed 
        and oriented into the work force in order to become 
        self-sufficient.  The plan must target public assistance 
        applicants who are most likely to become self-sufficient quickly 
        with short-term assistance or services such as child care, child 
        support enforcement, or employment and training services.  
           The plan may include vendor payments, mandatory job search, 
        refocusing existing county or provider efforts, or other program 
        features.  The commissioner may approve a county plan which 
        allows a county to use other program funding for the county work 
        focus program in a more flexible manner.  Nothing in this 
        section shall allow payments made to the public assistance 
        applicant to be less than the amount the applicant would have 
        received if the program had not been implemented, or reduce or 
        eliminate a category of eligible participants from the program 
        without legislative approval.  
           The commissioner shall not approve a county plan that would 
        have an adverse impact on the Minnesota family investment plan 
        demonstration.  If the plan is approved by the commissioner, the 
        county may implement the plan.  If the plan is approved by the 
        commissioner, but a federal waiver is necessary to implement the 
        plan, the commissioner shall apply for the necessary federal 
        waivers. 
           Sec. 63.  Minnesota Statutes 1998, section 256D.23, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROGRAM ESTABLISHED.] Minnesota residents 
        who meet the income and resource standards of section 256D.01, 
        subdivision 1a, but do not qualify for cash benefits under 
        sections 256D.01 to 256D.22 256D.21, may qualify for a county 
        payment under this section. 
           Sec. 64.  Minnesota Statutes 1998, section 256D.435, 
        subdivision 3, is amended to read: 
           Subd. 3.  [APPLICATION FOR FEDERALLY FUNDED BENEFITS.] 
        Persons who live with the applicant or recipient, who have unmet 
        needs and for whom the applicant or recipient has financial 
        responsibility, must apply for and, if eligible, accept AFDC 
        Minnesota family investment program and any other federally 
        funded benefits, including MFIP-S.  
           Sec. 65.  Minnesota Statutes 1998, section 256D.44, 
        subdivision 5, is amended to read: 
           Subd. 5.  [SPECIAL NEEDS.] In addition to the state 
        standards of assistance established in subdivisions 1 to 4, 
        payments are allowed for the following special needs of 
        recipients of Minnesota supplemental aid who are not residents 
        of a nursing home, a regional treatment center, or a group 
        residential housing facility. 
           (a) The county agency shall pay a monthly allowance for 
        medically prescribed diets payable under the AFDC program or the 
        Minnesota family investment program-statewide program if the 
        cost of those additional dietary needs cannot be met through 
        some other maintenance benefit.  
           (b) Payment for nonrecurring special needs must be allowed 
        for necessary home repairs or necessary repairs or replacement 
        of household furniture and appliances using the payment standard 
        of the AFDC program in effect on July 16, 1996, for these 
        expenses, as long as other funding sources are not available.  
           (c) A fee for guardian or conservator service is allowed at 
        a reasonable rate negotiated by the county or approved by the 
        court.  This rate shall not exceed five percent of the 
        assistance unit's gross monthly income up to a maximum of $100 
        per month.  If the guardian or conservator is a member of the 
        county agency staff, no fee is allowed. 
           (d) The county agency shall continue to pay a monthly 
        allowance of $68 for restaurant meals for a person who was 
        receiving a restaurant meal allowance on June 1, 1990, and who 
        eats two or more meals in a restaurant daily.  The allowance 
        must continue until the person has not received Minnesota 
        supplemental aid for one full calendar month or until the 
        person's living arrangement changes and the person no longer 
        meets the criteria for the restaurant meal allowance, whichever 
        occurs first. 
           (e) A fee of ten percent of the recipient's gross income or 
        $25, whichever is less, is allowed for representative payee 
        services provided by an agency that meets the requirements under 
        SSI regulations to charge a fee for representative payee 
        services.  This special need is available to all recipients of 
        Minnesota supplemental aid regardless of their living 
        arrangement. 
           Sec. 66.  Minnesota Statutes 1998, section 256E.03, 
        subdivision 2, is amended to read: 
           Subd. 2.  (a) "Community social services" means services 
        provided or arranged for by county boards to fulfill the 
        responsibilities prescribed in section 256E.08, subdivision 1, 
        to the following groups of persons: 
           (1) families with children under age 18, who are 
        experiencing child dependency, neglect or abuse, and also 
        pregnant adolescents, adolescent parents under the age of 18 and 
        their children, and other adolescents; 
           (2) persons, including adolescents, who are under the 
        guardianship of the commissioner of human services as dependent 
        and neglected wards; 
           (3) adults who are in need of protection and vulnerable as 
        defined in section 626.5572; 
           (4) persons age 60 and over who are experiencing difficulty 
        living independently and are unable to provide for their own 
        needs; 
           (5) emotionally disturbed children and adolescents, 
        chronically and acutely mentally ill persons who are unable to 
        provide for their own needs or to independently engage in 
        ordinary community activities; 
           (6) persons with mental retardation as defined in section 
        252A.02, subdivision 2, or with related conditions as defined in 
        section 252.27, subdivision 1a, who are unable to provide for 
        their own needs or to independently engage in ordinary community 
        activities; 
           (7) drug dependent and intoxicated persons, including 
        adolescents, as defined in section 254A.02, subdivisions 5 and 
        7, and persons, including adolescents, at risk of harm to self 
        or others due to the ingestion of alcohol or other drugs; 
           (8) parents whose income is at or below 70 percent of the 
        state median income and who are in need of child care services 
        in order to secure or retain employment or to obtain the 
        training or education necessary to secure employment; 
           (9) children and adolescents involved in or at risk of 
        involvement with criminal activity; and 
           (10) other groups of persons who, in the judgment of the 
        county board, are in need of social services. 
           (b) Except as provided in section 256E.08, subdivision 5, 
        community social services do not include public assistance 
        programs known as aid to families with dependent children, the 
        Minnesota family investment program-statewide program, Minnesota 
        supplemental aid, medical assistance, general assistance, 
        general assistance medical care, or community health services 
        authorized by sections 145A.09 to 145A.13.  
           Sec. 67.  Minnesota Statutes 1998, section 256E.06, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [FORMULA.] The commissioner of human 
        services shall distribute community social service aids to each 
        county board in an amount determined according to the following 
        formula: 
           In calendar year 1982 and thereafter: 
           (a) One-third shall be distributed on the basis of the 
        average unduplicated number of persons who receive AFDC, 
        Minnesota family investment program-statewide program 
        assistance, general assistance, and medical assistance per month 
        in the calendar year two years prior to the year for which funds 
        are being distributed as reported in the average monthly 
        caseload reports required under sections 256.01, 256B.04 and 
        256D.04, and certified by the commissioner of human services; 
        and 
           (b) One-third shall be distributed on the basis of the 
        number of persons residing in the county as determined by the 
        most recent data of the state demographer; 
           (c) One-third shall be distributed on the basis of the 
        number of persons residing in the county who are 65 years old or 
        older as determined by the most recent data of the state 
        demographer. 
           Sec. 68.  Minnesota Statutes 1998, section 256E.06, 
        subdivision 3, is amended to read: 
           Subd. 3.  [PAYMENTS TO COUNTIES.] The commissioner of human 
        services shall make payments for community social services to 
        each county in four installments per year.  The commissioner of 
        human services may certify the payments for the first three 
        months of a calendar year based on estimates of the unduplicated 
        number of persons receiving AFDC, Minnesota family investment 
        program-statewide program, general assistance and medical 
        assistance for the prior year.  The following three payments 
        shall be adjusted to reflect the actual unduplicated number of 
        persons who received AFDC, Minnesota family investment 
        program-statewide program, general assistance and medical 
        assistance as required by subdivision 1.  The commissioner shall 
        ensure that the pertinent payment of the allotment for that 
        quarter is made to each county on the first working day after 
        the end of each quarter of the calendar year, except for the 
        last quarter of the calendar year.  The commissioner shall 
        ensure that each county receives its payment of the allotment 
        for that quarter no later than the last working day of that 
        quarter.  This scheduling of payments does not require 
        compliance with subdivision 10.  
           Sec. 69.  Minnesota Statutes 1998, section 256E.07, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [FORMULA.] In federal fiscal year 1985 and 
        subsequent years, money for social services that is received 
        from the federal government to reimburse counties for social 
        service expenditures according to title XX of the Social 
        Security Act shall be allocated to each county according to the 
        following formula:  
           (a) Two-thirds shall be allocated on the basis of the 
        annual average number of unduplicated active monthly caseloads 
        in each county in the following programs:  aid to families with 
        dependent children, Minnesota family investment 
        program-statewide program, medical assistance, general 
        assistance, supplementary security income, and Minnesota 
        supplemental aid.  
           (b) One-third shall be allocated on the basis of the number 
        of persons residing in the county as determined by the most 
        recent estimate of the state demographer.  
           (c) The commissioner shall allocate to the counties 
        according to this section the total money received from the 
        federal government for social services according to title XX of 
        the Social Security Act, except that portion of the state's 
        allocation which the legislature authorizes for administrative 
        purposes and for migrant day care. 
           Sec. 70.  Minnesota Statutes 1998, section 256E.08, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ADMINISTRATION OF INCOME MAINTENANCE PROGRAMS.] 
        The county board may designate itself, a human services board, 
        or a local social services agency to perform the functions of 
        local social services agencies as prescribed in chapter 393 and 
        assigned to county agencies in other law which pertains to the 
        administration of income maintenance programs known as aid to 
        families with dependent children, Minnesota family investment 
        program-statewide program, general assistance, Minnesota 
        supplemental aid, medical assistance, general assistance medical 
        care, and emergency assistance.  
           Sec. 71.  Minnesota Statutes 1998, section 256F.05, 
        subdivision 3, is amended to read: 
           Subd. 3.  [GRANT FORMULA.] (a) The amount of money 
        allocated to counties under subdivision 2 shall first be 
        allocated in amounts equal to each county's guaranteed floor 
        according to paragraph (b), and second, any remaining available 
        funds allocated as follows: 
           (1) 50 percent of the funds shall be allocated based on the 
        population of the county under age 19 years as compared to the 
        state as a whole as determined by the most recent data from the 
        state demographer's office; 
           (2) 20 percent of funds shall be allocated based on the 
        county's percentage share of the unduplicated number of families 
        who received family preservation services under section 256F.03, 
        subdivision 5, paragraphs (a), (b), (c), and (e), in the most 
        recent calendar year available as determined by the 
        commissioner; 
           (3) ten percent of the funds shall be allocated based on 
        the county's percentage share of the unduplicated number of 
        children in substitute care in the most recent calendar year 
        available as determined by the commissioner; 
           (4) ten percent of the funds shall be allocated based on 
        the county's percentage share of the number of determined 
        maltreatment reports in the most recent calendar year available 
        as determined by the commissioner; 
           (5) five percent of the funds shall be allocated based on 
        the county's percentage share of the number of American Indian 
        children under age 18 residing in the county in the most recent 
        calendar year as determined by the commissioner; and 
           (6) five percent of the funds shall be allocated based on 
        the county's percentage share of the number of children of color 
        receiving children's case management services as defined by the 
        commissioner based on the most recent data as determined by the 
        commissioner. 
           (b) Each county's grant guaranteed floor shall be 
        calculated as follows: 
           (1) 90 percent of the county's allocation received in the 
        preceding calendar year or $25,000, whichever is greater; and 
           (2) when the amounts of funds available for allocation is 
        less than the amount available in the previous year, each 
        county's previous year allocation shall be reduced in proportion 
        to the reduction in the statewide funding, for the purpose of 
        establishing the guaranteed floor. 
           (c) The commissioner shall regularly review the use of 
        family preservation fund allocations by county.  The 
        commissioner may reallocate unexpended or unencumbered money at 
        any time among those counties that have expended or are 
        projected to expend their full allocation. 
           (d) For the period of July 1, 1997, to December 31, 1998, 
        only, each county shall receive an 18-month allocation.  For the 
        purposes of determining the guaranteed floor for this 18-month 
        allocation, the allocation received in the preceding calendar 
        year shall be determined by the commissioner based on the 
        funding previously distributed separately under sections 
        256.8711 and 256F.04. 
           Sec. 72.  Minnesota Statutes 1998, section 256F.05, 
        subdivision 8, is amended to read: 
           Subd. 8.  [USES OF FAMILY PRESERVATION FUND GRANTS.] (a) A 
        county which has not demonstrated that year that its family 
        preservation core services are developed as provided in 
        subdivision 1a, must use its family preservation fund grant 
        exclusively for family preservation services defined in section 
        256F.03, subdivision 5, paragraphs (a), (b), (c), and (e). 
           (b) A county which has demonstrated that year that its 
        family preservation core services are developed becomes eligible 
        either to continue using its family preservation fund grant as 
        provided in paragraph (a), or to exercise the expanded service 
        option under paragraph (c). 
           (c) The expanded service option permits an eligible county 
        to use its family preservation fund grant for child welfare 
        preventive services.  For purposes of this section, child 
        welfare preventive services are those services directed toward a 
        specific child or family that further the goals of section 
        256F.01 and include assessments, family preservation services, 
        service coordination, community-based treatment, crisis nursery 
        services when the parents retain custody and there is no 
        voluntary placement agreement with a child-placing agency, 
        respite care except when it is provided under a medical 
        assistance waiver, home-based services, and other related 
        services.  For purposes of this section, child welfare 
        preventive services shall not include shelter care or other 
        placement services under the authority of the court or public 
        agency to address an emergency.  To exercise this option, an 
        eligible county must notify the commissioner in writing of its 
        intention to do so no later than 30 days into the quarter during 
        which it intends to begin or in its county plan, as provided in 
        section 256F.04, subdivision 2.  Effective with the first day of 
        that quarter, the county must maintain its base level of 
        expenditures for child welfare preventive services and use the 
        family preservation fund to expand them.  The base level of 
        expenditures for a county shall be that established under 
        section 256F.10, subdivision 7.  For counties which have no such 
        base established, a comparable base shall be established with 
        the base year being the calendar year ending at least two 
        calendar quarters before the first calendar quarter in which the 
        county exercises its expanded service option.  The commissioner 
        shall, at the request of the counties, reduce, suspend, or 
        eliminate either or both of a county's obligations to continue 
        the base level of expenditures and to expand child welfare 
        preventive services under extraordinary circumstances.  
           (d) Notwithstanding paragraph (a), a county that is 
        participating in the child protection assessments or 
        investigations community collaboration pilot program under 
        section 626.5560 626.556, or in the concurrent permanency 
        planning pilot program under section 257.0711, may use its 
        family preservation fund grant for those programs. 
           Sec. 73.  Minnesota Statutes 1998, section 256F.10, 
        subdivision 6, is amended to read: 
           Subd. 6.  [DISTRIBUTION OF NEW FEDERAL REVENUE.] (a) Except 
        for portion set aside in paragraph (b), the federal funds earned 
        under this section and section 256B.094 by counties shall be 
        paid to each county based on its earnings, and must be used by 
        each county to expand preventive child welfare services. 
        If a county chooses to be a provider of child welfare targeted 
        case management and if that county also joins a local children's 
        mental health collaborative as authorized by the 1993 
        legislature, then the federal reimbursement received by the 
        county for providing child welfare targeted case management 
        services to children served by the local collaborative shall be 
        transferred by the county to the integrated fund.  The federal 
        reimbursement transferred to the integrated fund by the county 
        must not be used for residential care other than respite care 
        described under subdivision 7, paragraph (d). 
           (b) The commissioner shall set aside a portion of the 
        federal funds earned under this section to repay the special 
        revenue maximization account under section 256.01, subdivision 
        2, clause (15).  The repayment is limited to: 
           (1) the costs of developing and implementing this section 
        and sections 256.8711 and 256B.094 and 256J.48; 
           (2) programming the information systems; and 
           (3) the lost federal revenue for the central office claim 
        directly caused by the implementation of these sections. 
           Any unexpended funds from the set aside under this 
        paragraph shall be distributed to counties according to 
        paragraph (a). 
           Sec. 74.  Minnesota Statutes 1998, section 256F.13, 
        subdivision 3, is amended to read: 
           Subd. 3.  [WAIVER OF RULE REQUIREMENTS.] (a)  [REQUESTING 
        WAIVERS OF STATE OR FEDERAL RULES.] Local family services 
        collaboratives, including collaboratives in Becker, Cass, and 
        Ramsey counties, shall be encouraged to seek waivers of state or 
        federal rules, as necessary to carry out the purposes of this 
        section.  For purposes of this section, "family services 
        collaborative" has the meaning given it in section 121.8355, 
        subdivision 1a. 
           (b)  [WAIVER OF STATE RULES.] In order to receive a waiver 
        of the requirements of any state rule, the collaborative shall 
        submit a request for a variance to the appropriate 
        commissioner.  The request shall contain assurances that the 
        waiver will not affect client entitlements to services, will not 
        abridge any rights guaranteed to the client by state or federal 
        law, and will not jeopardize the health or safety of the 
        client.  The commissioner shall grant or deny all waiver 
        requests within 30 days of receiving those requests, by notice 
        to the collaborative and published notice in the State Register. 
           (c)  [WAIVER OF FEDERAL RULES.] A local collaborative 
        seeking a waiver from a federal rule shall submit a request, in 
        writing, to the appropriate commissioner who shall submit the 
        waiver request to the relevant policy committees of the 
        legislature.  If the legislative committees approve the request, 
        they shall direct the appropriate state agency to make a 
        reasonable effort to negotiate a waiver of the federal rule.  If 
        the legislative committees deny the request for a waiver, they 
        shall jointly notify the local collaborative of the reason for 
        denying the waiver.  If a waiver request is approved for 
        submission to federal authorities, the commissioner shall submit 
        all necessary materials to the appropriate federal authorities.  
        The commissioner shall notify the collaborative and the 
        legislative committees of the outcome of the federal waiver 
        request.  In every instance in which a federal waiver is 
        granted, the commissioner shall publish notice of receipt of the 
        waiver in the State Register. 
           Sec. 75.  Minnesota Statutes 1998, section 256G.01, 
        subdivision 4, is amended to read: 
           Subd. 4.  [ADDITIONAL COVERAGE.] The provisions in sections 
        256G.02, subdivision 4, paragraphs (a) to (d); 256G.02, 
        subdivisions 5 to 8; 256G.03; 256G.04; 256G.05; and 256G.07, 
        subdivisions 1 to 3, apply to the following programs:  the aid 
        to families with dependent children program formerly codified in 
        sections 256.72 to 256.87, Minnesota family investment 
        program-statewide program; medical assistance; general 
        assistance; the family general assistance program formerly 
        codified in sections 256D.01 to 256D.23; general assistance 
        medical care; and Minnesota supplemental aid. 
           Sec. 76.  Minnesota Statutes 1998, section 256G.03, 
        subdivision 2, is amended to read: 
           Subd. 2.  [NO DURATIONAL TEST.] Except as otherwise 
        provided in sections 256.73, subdivisions 1 and 1b 256J.75; 
        256B.056, subdivision 1; 256D.02, subdivision 12a, and 256J.12 
        for purposes of this chapter, no waiting period is required 
        before securing county or state residence.  A person cannot, 
        however, gain residence while physically present in an excluded 
        time facility unless otherwise specified in this chapter or in a 
        federal regulation controlling a federally funded human service 
        program.  Interstate migrants who enter a shelter for battered 
        women directly from another state can gain residency while in 
        the facility provided the person can provide documentation that 
        the person is a victim of domestic abuse as defined in section 
        256J.49, subdivision 2, and the county determines that the 
        placement is appropriate; and the commissioner of human services 
        is authorized to make per diem payments under section 256D.05, 
        subdivision 3, on behalf of such individuals. 
           Sec. 77.  Minnesota Statutes 1998, section 256J.01, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [IMPLEMENTATION OF MINNESOTA FAMILY 
        INVESTMENT PROGRAM-STATEWIDE (MFIP-S) PROGRAM (MFIP).] This 
        chapter and chapter 256K may be cited as the Minnesota family 
        investment program-statewide (MFIP-S) program (MFIP).  MFIP-S 
        MFIP is the statewide implementation of components of the 
        Minnesota family investment plan (MFIP) authorized under and 
        formerly codified in section 256.031 and Minnesota family 
        investment plan-Ramsey county (MFIP-R) formerly codified in 
        section 256.047. 
           Sec. 78.  Minnesota Statutes 1998, section 256J.11, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GENERAL CITIZENSHIP REQUIREMENTS.] (a) To 
        be eligible for AFDC or MFIP-S MFIP, whichever is in effect, a 
        member of the assistance unit must be a citizen of the United 
        States, a qualified noncitizen as defined in section 256J.08, or 
        a noncitizen who is otherwise residing lawfully in the United 
        States. 
           (b) A qualified noncitizen who entered the United States on 
        or after August 22, 1996, is eligible for MFIP-S MFIP.  However, 
        TANF dollars cannot be used to fund the MFIP-S MFIP benefits for 
        an individual under this paragraph for a period of five years 
        after the date of entry unless the qualified noncitizen meets 
        one of the following criteria: 
           (1) was admitted to the United States as a refugee under 
        United States Code, title 8, section 1157; 
           (2) was granted asylum under United States Code, title 8, 
        section 1158; 
           (3) was granted withholding of deportation under the United 
        States Code, title 8, section 1253(h); 
           (4) is a veteran of the United States Armed Forces with an 
        honorable discharge for a reason other than noncitizen status, 
        or is a spouse or unmarried minor dependent child of the same; 
        or 
           (5) is an individual on active duty in the United States 
        Armed Forces, other than for training, or is a spouse or 
        unmarried minor dependent child of the same. 
           (c) A person who is not a qualified noncitizen but who is 
        otherwise residing lawfully in the United States is eligible for 
        MFIP-S MFIP.  However, TANF dollars cannot be used to fund the 
        MFIP-S MFIP benefits for an individual under this paragraph. 
           (d) For purposes of this subdivision, a nonimmigrant in one 
        or more of the classes listed in United States Code, title 8, 
        section 1101(a)(15), or an undocumented immigrant who resides in 
        the United States without the approval or acquiescence of the 
        Immigration and Naturalization Service, is not eligible for 
        MFIP-S. 
           Sec. 79.  Minnesota Statutes 1998, section 256J.11, 
        subdivision 2, is amended to read: 
           Subd. 2.  [NONCITIZENS; FOOD PORTION.] (a) For the period 
        September 1, 1997, to October 31, 1997, noncitizens who do not 
        meet one of the exemptions in section 412 of the Personal 
        Responsibility and Work Opportunity Reconciliation Act of 1996, 
        but were residing in this state as of July 1, 1997, are eligible 
        for the 6/10 of the average value of food stamps for the same 
        family size and composition until MFIP-S is operative in the 
        noncitizen's county of financial responsibility and thereafter, 
        the 6/10 of the food portion of MFIP-S.  However, federal food 
        stamp dollars cannot be used to fund the food portion of MFIP-S 
        benefits for an individual under this subdivision. 
           (b) (a) For the period November 1, 1997, to June 30, 1999, 
        noncitizens who do not meet one of the exemptions in section 412 
        of the Personal Responsibility and Work Opportunity 
        Reconciliation Act of 1996, and are receiving cash assistance 
        under the AFDC, family general assistance, MFIP or MFIP-S 
        programs are eligible for the average value of food stamps for 
        the same family size and composition until MFIP-S MFIP is 
        operative in the noncitizen's county of financial responsibility 
        and thereafter, the food portion of MFIP-S MFIP.  However, 
        federal food stamp dollars cannot be used to fund the food 
        portion of MFIP-S MFIP benefits for an individual under this 
        subdivision.  The assistance provided under this subdivision, 
        which is designated as a supplement to replace lost benefits 
        under the federal food stamp program, must be disregarded as 
        income in all programs that do not count food stamps as income 
        where the commissioner has the authority to make the income 
        disregard determination for the program. 
           (c) (b) The commissioner shall submit a state plan to the 
        secretary of agriculture to allow the commissioner to purchase 
        federal Food Stamp Program benefits in an amount equal to the 
        MFIP-S MFIP food portion for each legal noncitizen receiving 
        MFIP-S MFIP assistance who is ineligible to participate in the 
        federal Food Stamp Program solely due to the provisions of 
        section 402 or 403 of Public Law Number 104-193, as authorized 
        by Title VII of the 1997 Emergency Supplemental Appropriations 
        Act, Public Law Number 105-18.  The commissioner shall enter 
        into a contract as necessary with the secretary to use the 
        existing federal Food Stamp Program benefits delivery system for 
        the purposes of administering the food portion of MFIP-S MFIP 
        under this subdivision. 
           Sec. 80.  Minnesota Statutes 1998, section 256J.12, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [SIMPLE RESIDENCY.] To be eligible for AFDC 
        or MFIP-S MFIP, whichever is in effect, an assistance unit must 
        have established residency in this state which means the 
        assistance unit is present in the state and intends to remain 
        here.  A person who lives in this state and who entered this 
        state with a job commitment or to seek employment in this state, 
        whether or not that person is currently employed, meets the 
        criteria in this subdivision.  
           Sec. 81.  Minnesota Statutes 1998, section 256J.21, 
        subdivision 3, is amended to read: 
           Subd. 3.  [INITIAL INCOME TEST.] The county agency shall 
        determine initial eligibility by considering all earned and 
        unearned income that is not excluded under subdivision 2.  To be 
        eligible for MFIP-S MFIP, the assistance unit's countable income 
        minus the disregards in paragraphs (a) and (b) must be below the 
        transitional standard of assistance according to section 256J.24 
        for that size assistance unit. 
           (a) The initial eligibility determination must disregard 
        the following items: 
           (1) the employment disregard is 18 percent of the gross 
        earned income whether or not the member is working full time or 
        part time; 
           (2) dependent care costs must be deducted from gross earned 
        income for the actual amount paid for dependent care up to a 
        maximum of $200 per month for each child less than two years of 
        age, and $175 per month for each child two years of age and 
        older under this chapter and chapter 119B; 
           (3) all payments made according to a court order for 
        spousal support or the support of children not living in the 
        assistance unit's household shall be disregarded from the income 
        of the person with the legal obligation to pay support, provided 
        that, if there has been a change in the financial circumstances 
        of the person with the legal obligation to pay support since the 
        support order was entered, the person with the legal obligation 
        to pay support has petitioned for a modification of the support 
        order; and 
           (4) an allocation for the unmet need of an ineligible 
        spouse or an ineligible child under the age of 21 for whom the 
        caregiver is financially responsible and who lives with the 
        caregiver according to section 256J.36. 
           (b) Notwithstanding paragraph (a), when determining initial 
        eligibility for applicant units when at least one member has 
        received AFDC, family general assistance, MFIP, MFIP-R, or work 
        first, or MFIP-S in this state within four months of the most 
        recent application for MFIP-S MFIP, the employment disregard for 
        all unit members is 36 percent of the gross earned income. 
           After initial eligibility is established, the assistance 
        payment calculation is based on the monthly income test. 
           Sec. 82.  Minnesota Statutes 1998, section 256J.26, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PERSON CONVICTED OF DRUG OFFENSES.] (a) 
        Applicants or participants who have been convicted of a drug 
        offense after July 1, 1997, may, if otherwise eligible, receive 
        AFDC or MFIP-S benefits subject to the following conditions: 
           (1) Benefits for the entire assistance unit must be paid in 
        vendor form for shelter and utilities during any time the 
        applicant is part of the assistance unit. 
           (2) The convicted applicant or participant shall be subject 
        to random drug testing as a condition of continued eligibility 
        and following any positive test for an illegal controlled 
        substance is subject to the following sanctions: 
           (i) for failing a drug test the first time, the 
        participant's grant shall be reduced by ten percent of the 
        MFIP-S MFIP transitional standard, the shared household 
        standard, or the interstate transitional standard, whichever is 
        applicable prior to making vendor payments for shelter and 
        utility costs; or 
           (ii) for failing a drug test two or more times, the 
        residual amount of the participant's grant after making vendor 
        payments for shelter and utility costs, if any, must be reduced 
        by an amount equal to 30 percent of the MFIP-S MFIP transitional 
        standard, the shared household standard, or the interstate 
        transitional standard, whichever is applicable. 
           (b) Applicants or participants who have been convicted of a 
        drug offense after July 1, 1997, may, if otherwise eligible, 
        receive food stamps if the convicted applicant or participant is 
        subject to random drug testing as a condition of continued 
        eligibility.  Following a positive test for an illegal 
        controlled substance, the applicant is subject to the following 
        sanctions: 
           (1) for failing a drug test the first time, food stamps 
        shall be reduced by ten percent of the applicable food stamp 
        allotment; and 
           (2) for failing a drug test two or more times, food stamps 
        shall be reduced by an amount equal to 30 percent of the 
        applicable food stamp allotment.  
           (c) For the purposes of this subdivision, "drug offense" 
        means a conviction that occurred after July 1, 1997, of sections 
        152.021 to 152.025, 152.0261, or 152.096.  Drug offense also 
        means a conviction in another jurisdiction of the possession, 
        use, or distribution of a controlled substance, or conspiracy to 
        commit any of these offenses, if the offense occurred after July 
        1, 1997, and the conviction is a felony offense in that 
        jurisdiction, or in the case of New Jersey, a high misdemeanor. 
           Sec. 83.  Minnesota Statutes 1998, section 256J.26, 
        subdivision 2, is amended to read: 
           Subd. 2.  [PAROLE VIOLATORS.] An individual violating a 
        condition of probation or parole or supervised release imposed 
        under federal law or the law of any state is disqualified from 
        receiving AFDC or MFIP-S MFIP. 
           Sec. 84.  Minnesota Statutes 1998, section 256J.26, 
        subdivision 3, is amended to read: 
           Subd. 3.  [FLEEING FELONS.] An individual who is fleeing to 
        avoid prosecution, or custody, or confinement after conviction 
        for a crime that is a felony under the laws of the jurisdiction 
        from which the individual flees, or in the case of New Jersey, 
        is a high misdemeanor, is disqualified from receiving AFDC or 
        MFIP-S MFIP. 
           Sec. 85.  Minnesota Statutes 1998, section 256J.26, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DENIAL OF ASSISTANCE FOR TEN YEARS TO A PERSON 
        FOUND TO HAVE FRAUDULENTLY MISREPRESENTED RESIDENCY.] An 
        individual who is convicted in federal or state court of having 
        made a fraudulent statement or representation with respect to 
        the place of residence of the individual in order to receive 
        assistance simultaneously from two or more states is 
        disqualified from receiving AFDC or MFIP-S MFIP for ten years 
        beginning on the date of the conviction. 
           Sec. 86.  Minnesota Statutes 1998, section 256J.42, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [TIME LIMIT.] (a) Except for the exemptions 
        in this section and in section 256J.11, subdivision 2, an 
        assistance unit in which any adult caregiver has received 60 
        months of cash assistance funded in whole or in part by the TANF 
        block grant in this or any other state or United States 
        territory, MFIP-S MFIP, the AFDC program formerly codified in 
        sections 256.72 to 256.87, or the family general assistance 
        program formerly codified in sections 256D.01 to 256D.23, funded 
        in whole or in part by state appropriations, is ineligible to 
        receive MFIP-S MFIP.  Any cash assistance funded with TANF 
        dollars in this or any other state or United States territory, 
        or MFIP-S MFIP assistance funded in whole or in part by state 
        appropriations, that was received by the unit on or after the 
        date TANF was implemented, including any assistance received in 
        states or United States territories of prior residence, counts 
        toward the 60-month limitation.  The 60-month limit applies to a 
        minor who is the head of a household or who is married to the 
        head of a household except under subdivision 5.  The 60-month 
        time period does not need to be consecutive months for this 
        provision to apply.  
           (b) Months before July 1998 in which individuals receive 
        assistance as part of an MFIP, MFIP-R, or MFIP or MFIP-R 
        comparison group family under formerly codified in sections 
        256.031 to 256.0361 or sections 256.047 to 256.048 are not 
        included in the 60-month time limit. 
           Sec. 87.  Minnesota Statutes 1998, section 256J.42, 
        subdivision 5, is amended to read: 
           Subd. 5.  [EXEMPTION FOR CERTAIN FAMILIES.] (a) Any cash 
        assistance received by an assistance unit does not count toward 
        the 60-month limit on assistance during a month in which the 
        caregiver is in the category in section 256J.56, clause (1). The 
        exemption applies for the period of time the caregiver belongs 
        to one of the categories specified in this subdivision. 
           (b) From July 1, 1997, until the date MFIP-S MFIP is 
        operative in the caregiver's county of financial responsibility, 
        any cash assistance received by a caregiver who is complying 
        with sections Minnesota Statutes 1996, section 256.73, 
        subdivision 5a, and Minnesota Statutes 1998, section 256.736, if 
        applicable, does not count toward the 60-month limit on 
        assistance.  Thereafter, any cash assistance received by a minor 
        caregiver who is complying with the requirements of sections 
        256J.14 and 256J.54, if applicable, does not count towards the 
        60-month limit on assistance. 
           (c) Any diversionary assistance or emergency assistance 
        received does not count toward the 60-month limit. 
           (d) Any cash assistance received by an 18- or 19-year-old 
        caregiver who is complying with the requirements of section 
        256J.54 does not count toward the 60-month limit. 
           Sec. 88.  Minnesota Statutes 1998, section 256J.43, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PAYMENT.] (a) Effective July 1, 1997, the 
        amount of assistance paid to an eligible unit in which all 
        members have resided in this state for fewer than 12 consecutive 
        calendar months immediately preceding the date of application 
        shall be the lesser of either the interstate transitional 
        standard that would have been received by the assistance unit 
        from the state of immediate prior residence, or the amount 
        calculated in accordance with AFDC or MFIP-S MFIP standards.  
        The lesser payment must continue until the assistance unit meets 
        the 12-month requirement.  An assistance unit that has not 
        resided in Minnesota for 12 months from the date of application 
        is not exempt from the interstate payment provisions solely 
        because a child is born in Minnesota to a member of the 
        assistance unit.  Payment must be calculated by applying this 
        state's budgeting policies, and the unit's net income must be 
        deducted from the payment standard in the other state or in this 
        state, whichever is lower.  Payment shall be made in vendor form 
        for shelter and utilities, up to the limit of the grant amount, 
        and residual amounts, if any, shall be paid directly to the 
        assistance unit. 
           (b) During the first 12 months an assistance unit resides 
        in this state, the number of months that a unit is eligible to 
        receive AFDC or MFIP-S MFIP benefits is limited to the number of 
        months the assistance unit would have been eligible to receive 
        similar benefits in the state of immediate prior residence. 
           (c) This policy applies whether or not the assistance unit 
        received similar benefits while residing in the state of 
        previous residence. 
           (d) When an assistance unit moves to this state from 
        another state where the assistance unit has exhausted that 
        state's time limit for receiving benefits under that state's 
        TANF program, the unit will not be eligible to receive any AFDC 
        or MFIP-S MFIP benefits in this state for 12 months from the 
        date the assistance unit moves here. 
           (e) For the purposes of this section, "state of immediate 
        prior residence" means: 
           (1) the state in which the applicant declares the applicant 
        spent the most time in the 30 days prior to moving to this 
        state; or 
           (2) the state in which an applicant who is a migrant worker 
        maintains a home. 
           (f) The commissioner shall annually verify and update all 
        other states' payment standards as they are to be in effect in 
        July of each year. 
           (g) Applicants must provide verification of their state of 
        immediate prior residence, in the form of tax statements, a 
        driver's license, automobile registration, rent receipts, or 
        other forms of verification approved by the commissioner. 
           (h) Migrant workers, as defined in section 256J.08, and 
        their immediate families are exempt from this section, provided 
        the migrant worker provides verification that the migrant family 
        worked in this state within the last 12 months and earned at 
        least $1,000 in gross wages during the time the migrant worker 
        worked in this state. 
           Sec. 89.  Minnesota Statutes 1998, section 256J.50, 
        subdivision 3a, is amended to read: 
           Subd. 3a.  [TRANSITIONAL RULE; STRIDE, ACCESS.] (a) A 
        county agency that is not a participant in the MFIP or MFIP-R 
        field trials under formerly codified in sections 256.031 to 
        256.0361 shall not enroll a recipient into project STRIDE or 
        ACCESS after the date that MFIP-S MFIP is implemented in the 
        county.  
           (b) A caregiver who: 
           (i) was enrolled in project STRIDE or ACCESS continuously 
        since March 1, 1997; 
           (ii) is not a part of an MFIP or MFIP-R comparison group; 
        and 
           (iii) who is making satisfactory progress toward the 
        objectives specified in the caregiver's employment plan, may, 
        with the approval of the job counselor, continue with the 
        existing employment plan for up to two years after the caregiver 
        is enrolled in MFIP-S MFIP.  For purposes of the federal 
        participation standards, the activities in the caregiver's 
        employment plan are work activities, as that term is defined in 
        section 256J.49, subdivision 13. 
           (c) Notwithstanding contrary provisions of section 256.736, 
        the employability plan of a caregiver who is enrolled in project 
        STRIDE or ACCESS on or after July 1, 1997, must meet the 
        requirements of section 256J.53. 
           Sec. 90.  Minnesota Statutes 1998, section 256J.62, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ALLOCATION OF BALANCE OF FUNDS.] If there remain 
        funds to allocate after establishing each county's guaranteed 
        floor under the provisions in subdivision 2, the balance 
        of funds shall be allocated as follows: 
           (1) for state fiscal year 1998, the remaining funds shall 
        be allocated based on the county's average number of AFDC and 
        family general assistance cases as compared to the statewide 
        total number of cases.  The average number of cases shall be 
        based on counts of AFDC and family general assistance cases as 
        of March 31, June 30, September 30, and December 31 of calendar 
        year 1996; 
           (2) for state fiscal year 1999, the remaining funds shall 
        be allocated based on the county's average number of AFDC, 
        family general assistance, MFIP-R, MFIP, and MFIP-S cases as 
        compared to the statewide total number of cases.  The average 
        number of cases shall be based on counts of AFDC, family general 
        assistance, MFIP-R, MFIP, and MFIP-S cases as of March 31, June 
        30, September 30, and December 31 of calendar year 1997; and 
           (3) for all subsequent state fiscal years, the remaining 
        funds shall be allocated based on the county's average number of 
        MFIP-S MFIP cases as compared to the statewide total number of 
        cases.  The average number of cases must be based on counts of 
        MFIP-S MFIP cases as of March 31, June 30, September 30, and 
        December 31 of the previous calendar year. 
           Sec. 91.  Minnesota Statutes 1998, section 256J.62, 
        subdivision 6, is amended to read: 
           Subd. 6.  [BILINGUAL EMPLOYMENT AND TRAINING SERVICES TO 
        REFUGEES.] Funds appropriated to cover the costs of bilingual 
        employment and training services to refugees shall be allocated 
        to county agencies as follows: 
           (1) for state fiscal year 1998, the allocation shall be 
        based on the county's proportion of the total statewide number 
        of AFDC refugee cases in the previous fiscal year.  Counties 
        with less than one percent of the statewide number of AFDC, 
        MFIP-R, or MFIP refugee cases shall not receive an allocation of 
        bilingual employment and training services funds; and 
           (2) for each subsequent fiscal year, the allocation shall 
        be based on the county's proportion of the total statewide 
        number of MFIP-S MFIP refugee cases in the previous fiscal year. 
        Counties with less than one percent of the statewide number of 
        MFIP-S MFIP refugee cases shall not receive an allocation of 
        bilingual employment and training services funds. 
           Sec. 92.  Minnesota Statutes 1998, section 256J.62, 
        subdivision 7, is amended to read: 
           Subd. 7.  [WORK LITERACY LANGUAGE PROGRAMS.] Funds 
        appropriated to cover the costs of work literacy language 
        programs to non-English-speaking recipients shall be allocated 
        to county agencies as follows: 
           (1) for state fiscal year 1998, the allocation shall be 
        based on the county's proportion of the total statewide number 
        of AFDC or MFIP cases in the previous fiscal year where the lack 
        of English is a barrier to employment.  Counties with less than 
        two percent of the statewide number of AFDC or MFIP cases where 
        the lack of English is a barrier to employment shall not receive 
        an allocation of the work literacy language program funds; and 
           (2) for each subsequent fiscal year, the allocation shall 
        be based on the county's proportion of the total statewide 
        number of MFIP-S MFIP cases in the previous fiscal year where 
        the lack of English is a barrier to employment.  Counties with 
        less than two percent of the statewide number of MFIP-S MFIP 
        cases where the lack of English is a barrier to employment shall 
        not receive an allocation of the work literacy language program 
        funds. 
           Sec. 93.  Minnesota Statutes 1998, section 256J.76, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ADMINISTRATIVE FUNCTIONS.] Beginning July 
        1, 1997, counties will receive federal funds from the TANF block 
        grant for use in supporting eligibility, fraud control, and 
        other related administrative functions.  The federal funds 
        available for distribution, as determined by the commissioner, 
        must be an amount equal to federal administrative aid 
        distributed for fiscal year 1996 under titles IV-A and IV-F of 
        the Social Security Act in effect prior to October 1, 1996.  
        This amount must include the amount paid for local 
        collaboratives under sections 245.4932 and 256F.13, but must not 
        include administrative aid associated with child care under 
        section 119B.05, with emergency assistance intensive family 
        preservation services under section 256.8711 256F.05, with 
        administrative activities as part of the employment and training 
        services under section 256.736 this chapter or chapter 256K, or 
        with fraud prevention investigation activities under section 
        256.983. 
           Sec. 94.  Minnesota Statutes 1998, section 256K.01, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] As used in sections 256K.01 to 
        256K.09, the following words have the meanings given them. 
           (a) "Applicant" means an individual who has submitted a 
        request for assistance and has never received an AFDC grant as 
        formerly codified in sections 256.72 to 256.87, MFIP-S an MFIP 
        grant or a family general assistance grant as formerly codified 
        in sections 256D.01 to 256D.23 through the MAXIS computer system 
        as a caregiver, or an applicant whose application under the 
        former AFDC program codified in sections 256.72 to 
        256.87, MFIP-S MFIP, or the former family general assistance 
        application program codified in sections 256D.01 to 256D.23 was 
        denied or benefits were terminated due to noncompliance with 
        work first program requirements. 
           (b) "Application date" means the date any Minnesota county 
        agency receives a signed and dated combined application form 
        Part I. 
           (c) "CAF" means a combined application form on which people 
        apply for multiple assistance programs, including:  cash 
        assistance, refugee cash assistance, Minnesota supplemental aid, 
        food stamps, medical assistance, general assistance medical 
        care, emergency assistance, emergency medical assistance, and 
        emergency general assistance medical care. 
           (d) "Caregiver" means a parent or eligible adult, including 
        a pregnant woman, who is part of the assistance unit that has 
        applied for or is receiving an AFDC, MFIP-S, or family general 
        assistance an MFIP grant.  In a two-parent family, both parents 
        are caregivers. 
           (e) "Child support" means a voluntary or court-ordered 
        payment by absent parents in an assistance unit. 
           (f) "Commissioner" means the commissioner of human services.
           (g) "Department" means the department of human services. 
           (h) "Employability development plan" or "EDP" means a plan 
        developed by the applicant, with advice from the employment 
        advisor, for the purposes of identifying an employment goal, 
        improving work skills through certification or education, 
        training or skills recertification, and which addresses barriers 
        to employment. 
           (i) "EDP status report form" means a program form on which 
        deferred participants indicate what has been achieved in the 
        participant's employability development plan and the types of 
        problems encountered. 
           (j) "Employment advisor" means a program staff member who 
        is qualified to assist the participant to develop a job search 
        or employability development plan, match the participant with 
        existing job openings, refer the participant to employers, and 
        has an extensive knowledge of employers in the area. 
           (k) "Financial specialist" means a program staff member who 
        is trained to explain the benefits offered under the program, 
        determine eligibility for different assistance programs, and 
        broker other resources from employers and the community. 
           (l) "Job network" means individuals that a person may 
        contact to learn more about particular companies, inquire about 
        job leads, or discuss occupational interests and expertise. 
           (m) "Job search allowance" means the amount of financial 
        assistance needed to support job search. 
           (n) "Job search plan" or "JSP" means the specific plan 
        developed by the applicant, with advice from the employment 
        advisor, to secure a job as soon as possible, and focus the 
        scope of the job search process and other activities.  
           (o) "JSP status report form" means a program form on which 
        participants indicate the number of submitted job applications, 
        job interviews held, jobs offered, other outcomes achieved, 
        problems encountered, and the total number of hours spent on job 
        search per week. 
           (p) "Participant" means a recipient who is required to 
        participate in the work first program. 
           (q) "Program" means the work first program. 
           (r) "Provider" means an employment and training agency 
        certified by the commissioner of economic security under section 
        268.871, subdivision 1. 
           (s) "Self-employment" means employment where people work 
        for themselves rather than an employer, are responsible for 
        their own work schedule, and do not have taxes or FICA withheld 
        by an employer. 
           (t) "Self-sufficiency agreement" means the agreement 
        between the county or its representative and the applicant that 
        describes the activities that the applicant must conduct and the 
        necessary services and aid to be furnished by the county to 
        enable the individual to meet the purpose of either the job 
        search plan or employability development plan. 
           (u) "Subsidized job" means a job that is partly reimbursed 
        by the provider for cost of wages for participants in the 
        program. 
           Sec. 95.  Minnesota Statutes 1998, section 256K.01, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ESTABLISHING WORK FIRST PROGRAM.] The 
        commissioners of human services and economic security may 
        develop and establish pilot projects which require applicants 
        for aid under AFDC, MFIP-S or family general assistance MFIP to 
        meet the requirements of the work first program.  The purpose of 
        the program is to: 
           (1) ensure that the participant is working as early as 
        possible; 
           (2) promote greater opportunity for economic self-support, 
        participation, and mobility in the work force; and 
           (3) minimize the risk for long-term welfare dependency. 
           Sec. 96.  Minnesota Statutes 1998, section 256K.01, 
        subdivision 8, is amended to read: 
           Subd. 8.  [DUTIES OF PARTICIPANT.] To be eligible for an 
        AFDC, MFIP-S or family general assistance MFIP benefit, a 
        participant shall cooperate with the county agency, the 
        provider, and the participant's employer in all aspects of the 
        program. 
           Sec. 97.  Minnesota Statutes 1998, section 256K.015, is 
        amended to read: 
           256K.015 [ELIGIBILITY FOR WORK FIRST.] 
           To be eligible for work first, an applicant must meet the 
        eligibility requirements of AFDC or MFIP-S, whichever is in 
        effect in the county, MFIP, to the extent that those 
        requirements are not inconsistent with this chapter. 
           Sec. 98.  Minnesota Statutes 1998, section 256K.02, is 
        amended to read: 
           256K.02 [PROGRAM PARTICIPANTS; PROGRAM EXPECTATIONS.] 
           All applicants selected for participation are expected to 
        meet the requirements under the work first program.  Payments 
        for rent and utilities up to the AFDC, MFIP-S, or family general 
        assistance program MFIP benefits to which the assistance unit is 
        entitled will be vendor paid for as many months as the applicant 
        is eligible or six months, whichever comes first.  The residual 
        amount after vendor payment, if any, will be paid to the 
        recipient, unless it is used as a wage subsidy under section 
        256K.04, subdivision 2. 
           Sec. 99.  Minnesota Statutes 1998, section 256K.03, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [NOTIFICATION OF PROGRAM.] Except for the 
        provisions in this section, the provisions for the AFDC, MFIP-S, 
        and family general assistance MFIP application process shall be 
        followed.  Within two days after receipt of a completed combined 
        application form, the county agency must refer to the provider 
        the applicant who meets the conditions under section 256K.02, 
        and notify the applicant in writing of the program including the 
        following provisions: 
           (1) notification that, as part of the application process, 
        applicants are required to attend orientation, to be followed 
        immediately by a job search; 
           (2) the program provider, the date, time, and location of 
        the scheduled program orientation; 
           (3) the procedures for qualifying for and receiving 
        benefits under the program; 
           (4) the immediate availability of supportive services, 
        including, but not limited to, child care, transportation, 
        medical assistance, and other work-related aid; and 
           (5) the rights, responsibilities, and obligations of 
        participants in the program, including, but not limited to, the 
        grounds for exemptions and deferrals, the consequences for 
        refusing or failing to participate fully, and the appeal process.
           Sec. 100.  Minnesota Statutes 1998, section 256K.03, 
        subdivision 12, is amended to read: 
           Subd. 12.  [REQUIREMENT TO WORK IN A TEMPORARY PUBLIC 
        SERVICE JOB.] (a) If after the completion of the maximum eight 
        weeks of job search the participant has failed to secure a 
        nonsubsidized or a subsidized job for at least 32 hours per 
        week, or does not earn a net income from self-employment that is 
        equal to at least the AFDC, MFIP-S or family general assistance 
        MFIP monthly grant for the household size, whichever is 
        applicable, the participant is required to work in a temporary 
        public service job for up to 67 working days for (1) at least 32 
        hours per week, or (2) a period equivalent to the result of 
        dividing the monthly grant amount which the participant would 
        otherwise receive, by the federal hourly minimum wage, or 
        applicable hourly state minimum wage, or the hourly rate of pay 
        for individuals employed in the same occupation at the site, 
        whichever is highest.  If the result is more than 128 hours per 
        month, the participant's requirement to work in a temporary 
        public service job shall not be more than 32 hours per week. 
           (b) Within seven days from the date of application, the 
        participant who is deferred under subdivision 8, clause (1) or 
        (2), and is participating in an educational program on a 
        part-time basis must work in a temporary public service job as 
        required under subdivision 8, clause (2). 
           (c) The provider shall strive to match the profile of the 
        participant with the needs of the employers that are 
        participating in a temporary jobs program under section 256K.05. 
           Sec. 101.  Minnesota Statutes 1998, section 256K.04, 
        subdivision 2, is amended to read: 
           Subd. 2.  [JOB SUBSIDY.] The county may use all or part of 
        the AFDC, MFIP-S or family general assistance MFIP benefit as a 
        subsidy to employers for the purpose of providing work 
        experience or training to the participant who has completed the 
        job search plan, provided that: 
           (1) the job to be subsidized is permanent and full time, 
        and pays an hourly rate of at least $6 per hour; 
           (2) the employer agrees to retain the participant after 
        satisfactory completion of the work experience or training 
        period; and 
           (3) the participant has first tried to secure a 
        nonsubsidized job by following the job search plan.  
           The subsidy may be available for up to six months. 
           Sec. 102.  Minnesota Statutes 1998, section 256K.05, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ASSIGNMENT TO TEMPORARY PUBLIC SERVICE JOBS.] 
        The provider must assign the participant who (1) is within 
        completion of the required eight weeks of job search and has 
        failed to secure a nonsubsidized or a subsidized job for at 
        least 32 hours per week, or (2) does not earn a net income from 
        self-employment that is equal to at least the AFDC, MFIP-S or 
        family general assistance MFIP monthly grant for the household 
        size , whichever is applicable, to a temporary public service 
        job.  The assignment must be made seven days before the end of 
        the job search and be based on section 256K.03, subdivision 12.  
        The participant that is deferred under section 256K.03, 
        subdivision 8, will be assigned by the provider to a temporary 
        public service job within seven days after the application. 
           Sec. 103.  Minnesota Statutes 1998, section 256K.06, is 
        amended to read: 
           256K.06 [TRANSITIONAL BENEFITS TO SUPPORT WORK; RENT AND 
        UTILITIES VENDOR PAYMENT.] 
           Payments for rent and utilities up to the amount of AFDC, 
        MFIP-S, or family general assistance benefits to which the 
        assistance unit is entitled shall be provided in the form of 
        vendor payments for as many months as the applicant is eligible 
        or six months, whichever comes first.  The residual amount after 
        vendor payment, if any, will be paid to the AFDC, MFIP-S, or 
        family general assistance MFIP recipient, unless it is used as a 
        wage subsidy under section 256K.04, subdivision 2.  This 
        provision shall apply to all applicants including those meeting 
        the exemption categories under section 256K.03, subdivision 5, 
        or deferral categories under section 256K.03, subdivision 8.  To 
        the extent needed, a job search allowance shall be provided for 
        up to eight weeks to cover expenses related to the job search.  
        Before the job search allowance is issued, it must be approved 
        by the employment advisor and financial specialist, and clearly 
        described in the job search plan. 
           Sec. 104.  Minnesota Statutes 1998, section 256K.07, is 
        amended to read: 
           256K.07 [ELIGIBILITY FOR FOOD STAMPS, MEDICAL ASSISTANCE, 
        AND CHILD CARE.] 
           The participant shall be treated as an AFDC, MFIP-S, or 
        family general assistance MFIP recipient, whichever is 
        applicable, for food stamps, medical assistance, and child care 
        eligibility purposes.  The participant who leaves the program as 
        a result of increased earnings from employment shall be eligible 
        for transitional medical assistance and child care without 
        regard to AFDC, MFIP-S, or family general assistance MFIP 
        receipt in three of the six months preceding ineligibility. 
           Sec. 105.  Minnesota Statutes 1998, section 256K.08, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GOOD CAUSE.] (a) For purposes of this 
        subdivision, "good cause" means absence due to temporary illness 
        or injury of the participant or a member of the participant's 
        family, the unavailability of appropriate child care or 
        unavailability of transportation needed to attend orientation or 
        conduct job search, or a nonmedical emergency as defined under 
        section 256K.05, subdivision 5. 
           (b) The applicant who is required, but fails, without good 
        cause, to participate in orientation, complete the job search 
        plan or employability development plan, and comply with the job 
        search requirements under section 256K.03, prior to being 
        eligible for AFDC, MFIP-S, or family general assistance MFIP 
        shall be denied benefits.  The applicant will not be eligible 
        for benefits in this state for at least six months. 
           (c) If, after receiving a written warning from the county, 
        the participant fails, without good cause, to conduct at least 
        32 hours of job search per week in any given two-week period, 
        the participant will be immediately required to work for at 
        least 16 hours per week in a temporary public service job.  The 
        required 32 hours per week of job search will be reduced to 16 
        hours. 
           (d) If the participant who is deferred under section 
        256K.03, subdivision 8, fails to comply with the activities 
        described in the employability development plan, the participant 
        will lose the deferment status, provided that the participant 
        has received at least two written warnings from the provider. 
           (e) If the participant refuses to work in a temporary 
        public service job, or is terminated from a temporary public 
        service job for failure to work, benefits to the assistance unit 
        shall be terminated and the participant shall not be eligible 
        for aid under the MFIP-S MFIP program for at least six months 
        from the date of refusal or termination.  If the participant, 
        before completing at least four consecutive months of 
        employment, voluntarily quits or is terminated from a 
        nonsubsidized or a subsidized job, the participant shall 
        immediately be assigned to work in a temporary public service 
        job for at least 32 hours per week for up to 67 working days 
        unless the participant is hired or rehired into a nonsubsidized 
        or subsidized job. 
           Sec. 106.  Minnesota Statutes 1998, section 256L.11, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DEFINITION OF MEDICAL ASSISTANCE RATE FOR 
        INPATIENT HOSPITAL SERVICES.] The "medical assistance rate," as 
        used in this section to apply to rates for providing inpatient 
        hospital services, means the rates established under sections 
        256.9685 to 256.9695 for providing inpatient hospital services 
        to medical assistance recipients who receive aid to families 
        with dependent children Minnesota family investment program 
        assistance. 
           Sec. 107.  Minnesota Statutes 1998, section 257.33, 
        subdivision 2, is amended to read: 
           Subd. 2.  [MINOR PARENTS AND THEIR CHILDREN.] (a) Every 
        birth to a minor shall be reported by the hospital where the 
        birth occurs, within three working days after the birth.  The 
        hospital shall make the report to the county social services 
        agency in the county in which the minor mother resides and shall 
        notify the minor that the report has been made.  The county 
        social services agency shall contact any minor mother who does 
        not have a case manager who resides in the county and determine 
        whether she has a plan for herself and her child.  The plan must 
        consider: 
           (1) the age of the minor parent; 
           (2) the involvement of the minor's parents or of other 
        adults who provide active, ongoing guidance, support, and 
        supervision; 
           (3) the involvement of the father of the minor's child, 
        including steps being taken to establish paternity, if 
        appropriate; 
           (4) a decision of the minor to keep and raise her child or 
        place the child for adoption; 
           (5) completion of high school or GED; 
           (6) current economic support of the minor parent and child 
        and plans for economic self-sufficiency; 
           (7) parenting skills of the minor parent; 
           (8) living arrangement of the minor parent and child; 
           (9) child care and transportation needed for education, 
        training, or employment; 
           (10) ongoing health care; and 
           (11) other services as needed to address personal or family 
        problems or to facilitate the personal growth and development 
        and economic self-sufficiency of the minor parent and child. 
           (b) If the minor parent does not have a plan for herself 
        and child, the county social services agency shall work with her 
        to develop a plan and shall provide case management services as 
        needed to assure the resources and services are available to 
        meet the plan requirements. 
           (c) If the minor parent refuses to plan for herself and her 
        child or fails, without good cause, to follow through on an 
        agreed upon plan, the county social services agency may file a 
        petition under section 260.131 seeking an order for protective 
        supervision under section 260.191, subdivision 1, clause (a), on 
        the grounds that the minor parent's child is dependent due to 
        the state of immaturity of the minor parent.  A contract with a 
        minor parent under section 256.736, subdivision 
        11(a)(4) 256J.54, subdivision 2, is an "agreed upon plan" for 
        purposes of this section. 
           Sec. 108.  Minnesota Statutes 1998, section 257.3573, 
        subdivision 2, is amended to read: 
           Subd. 2.  [INAPPROPRIATE EXPENDITURES.] Indian child 
        welfare grant money must not be used for: 
           (1) child day care necessary solely because of employment 
        or training for employment of a parent or other relative with 
        whom the child is living; 
           (2) foster care maintenance or difficulty of care payments; 
           (3) residential facility payments; 
           (4) adoption assistance payments; 
           (5) public assistance payments for aid to families with 
        dependent children, Minnesota family investment 
        program-statewide program assistance, supplemental aid, medical 
        assistance, general assistance, general assistance medical care, 
        or community health services authorized by sections 145A.01 to 
        145A.14; or 
           (6) administrative costs for income maintenance staff.  
           Sec. 109.  Minnesota Statutes 1998, section 257.60, is 
        amended to read: 
           257.60 [PARTIES.] 
           The child may be made a party to the action.  If the child 
        is a minor and is made a party, a general guardian or a guardian 
        ad litem shall be appointed by the court to represent the 
        child.  The child's mother or father may not represent the child 
        as guardian or otherwise.  The biological mother, each man 
        presumed to be the father under section 257.55, and each man 
        alleged to be the biological father, shall be made parties or, 
        if not subject to the jurisdiction of the court, shall be given 
        notice of the action in a manner prescribed by the court and 
        shall be given an opportunity to be heard.  The public agency 
        responsible for support enforcement is joined as a party in each 
        case in which rights are assigned under section 256.74, 
        subdivision 5 256.741, and in each case in which the public 
        agency is providing services pursuant to an application for 
        child support services.  A person who may bring an action under 
        section 257.57 may be made a party to the action.  The court may 
        align the parties.  The child shall be made a party whenever: 
           (1) the child is a minor and the case involves a compromise 
        under section 257.64, subdivision 1, or a lump sum payment under 
        section 257.66, subdivision 4, in which case the commissioner of 
        human services shall also be made a party subject to department 
        of human services rules relating to paternity suit settlements; 
        or 
           (2) the child is a minor and the action is to declare the 
        nonexistence of the father and child relationship; or 
           (3) an action to declare the existence of the father and 
        child relationship is brought by a man presumed to be the father 
        under section 257.55, or a man who alleges to be the father, and 
        the mother of the child denies the existence of the father and 
        child relationship. 
           Sec. 110.  Minnesota Statutes 1998, section 257.85, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DEFINITIONS.] For purposes of this section, the 
        terms defined in this subdivision have the meanings given them. 
           (a) "AFDC or MFIP standard" means the monthly standard of 
        need used to calculate assistance under the AFDC program, the 
        transitional standard used to calculate assistance under the 
        MFIP-S program, or, if neither of those is applicable, the 
        analogous transitional standard used to calculate assistance 
        under the MFIP or MFIP-R programs. 
           (b) "Local agency" means the local social service agency 
        with legal custody of a child prior to the transfer of permanent 
        legal and physical custody to a relative. 
           (c) "Permanent legal and physical custody" means permanent 
        legal and physical custody ordered by a Minnesota juvenile court 
        under section 260.191, subdivision 3b. 
           (d) "Relative" means an individual, other than a parent, 
        who is related to a child by blood, marriage, or adoption. 
           (e) "Relative custodian" means a relative of a child for 
        whom the relative has permanent legal and physical custody.  
        When siblings, including half-siblings and step-siblings, are 
        placed together in the permanent legal and physical custody of a 
        relative of one of the siblings, the person receiving permanent 
        legal and physical custody of the siblings is considered a 
        relative custodian of all of the siblings for purposes of this 
        section. 
           (f) "Relative custody assistance agreement" means an 
        agreement entered into between a local agency and the relative 
        of a child who has been or will be awarded permanent legal and 
        physical custody of the child. 
           (g) "Relative custody assistance payment" means a monthly 
        cash grant made to a relative custodian pursuant to a relative 
        custody assistance agreement and in an amount calculated under 
        subdivision 7. 
           (h) "Remains in the physical custody of the relative 
        custodian" means that the relative custodian is providing 
        day-to-day care for the child and that the child lives with the 
        relative custodian; absence from the relative custodian's home 
        for a period of more than 120 days raises a presumption that the 
        child no longer remains in the physical custody of the relative 
        custodian. 
           Sec. 111.  Minnesota Statutes 1998, section 257.85, 
        subdivision 5, is amended to read: 
           Subd. 5.  [RELATIVE CUSTODY ASSISTANCE AGREEMENT.] (a) A 
        relative custody assistance agreement will not be effective, 
        unless it is signed by the local agency and the relative 
        custodian no later than 30 days after the date of the order 
        establishing permanent legal and physical custody with the 
        relative, except that a local agency may enter into a relative 
        custody assistance agreement with a relative custodian more than 
        30 days after the date of the order if it certifies that the 
        delay in entering the agreement was through no fault of the 
        relative custodian.  There must be a separate agreement for each 
        child for whom the relative custodian is receiving relative 
        custody assistance. 
           (b) Regardless of when the relative custody assistance 
        agreement is signed by the local agency and relative custodian, 
        the effective date of the agreement shall be the date of the 
        order establishing permanent legal and physical custody. 
           (c) If MFIP-S MFIP is not the applicable program for a 
        child at the time that a relative custody assistance agreement 
        is entered on behalf of the child, when MFIP-S MFIP becomes the 
        applicable program, if the relative custodian had been receiving 
        custody assistance payments calculated based upon a different 
        program, the amount of relative custody assistance payment under 
        subdivision 7 shall be recalculated under the MFIP-S MFIP 
        program. 
           (d) The relative custody assistance agreement shall be in a 
        form specified by the commissioner and shall include provisions 
        relating to the following: 
           (1) the responsibilities of all parties to the agreement; 
           (2) the payment terms, including the financial 
        circumstances of the relative custodian, the needs of the child, 
        the amount and calculation of the relative custody assistance 
        payments, and that the amount of the payments shall be 
        reevaluated annually; 
           (3) the effective date of the agreement, which shall also 
        be the anniversary date for the purpose of submitting the annual 
        affidavit under subdivision 8; 
           (4) that failure to submit the affidavit as required by 
        subdivision 8 will be grounds for terminating the agreement; 
           (5) the agreement's expected duration, which shall not 
        extend beyond the child's eighteenth birthday; 
           (6) any specific known circumstances that could cause the 
        agreement or payments to be modified, reduced, or terminated and 
        the relative custodian's appeal rights under subdivision 9; 
           (7) that the relative custodian must notify the local 
        agency within 30 days of any of the following: 
           (i) a change in the child's status; 
           (ii) a change in the relationship between the relative 
        custodian and the child; 
           (iii) a change in composition or level of income of the 
        relative custodian's family; 
           (iv) a change in eligibility or receipt of benefits under 
        AFDC, MFIP-S MFIP, or other assistance program; and 
           (v) any other change that could affect eligibility for or 
        amount of relative custody assistance; 
           (8) that failure to provide notice of a change as required 
        by clause (7) will be grounds for terminating the agreement; 
           (9) that the amount of relative custody assistance is 
        subject to the availability of state funds to reimburse the 
        local agency making the payments; 
           (10) that the relative custodian may choose to temporarily 
        stop receiving payments under the agreement at any time by 
        providing 30 days' notice to the local agency and may choose to 
        begin receiving payments again by providing the same notice but 
        any payments the relative custodian chooses not to receive are 
        forfeit; and 
           (11) that the local agency will continue to be responsible 
        for making relative custody assistance payments under the 
        agreement regardless of the relative custodian's place of 
        residence. 
           Sec. 112.  Minnesota Statutes 1998, section 257.85, 
        subdivision 7, is amended to read: 
           Subd. 7.  [AMOUNT OF RELATIVE CUSTODY ASSISTANCE PAYMENTS.] 
        (a) The amount of a monthly relative custody assistance payment 
        shall be determined according to the provisions of this 
        paragraph. 
           (1) The total maximum assistance rate is equal to the base 
        assistance rate plus, if applicable, the supplemental assistance 
        rate. 
           (i) The base assistance rate is equal to the maximum amount 
        that could be received as basic maintenance for a child of the 
        same age under the adoption assistance program. 
           (ii) The local agency shall determine whether the child has 
        physical, mental, emotional, or behavioral disabilities that 
        require care, supervision, or structure beyond that ordinarily 
        provided in a family setting to children of the same age such 
        that the child would be eligible for supplemental maintenance 
        payments under the adoption assistance program if an adoption 
        assistance agreement were entered on the child's behalf.  If the 
        local agency determines that the child has such a disability, 
        the supplemental assistance rate shall be the maximum amount of 
        monthly supplemental maintenance payment that could be received 
        on behalf of a child of the same age, disabilities, and 
        circumstances under the adoption assistance program. 
           (2) The net maximum assistance rate is equal to the total 
        maximum assistance rate from clause (1) less the following 
        offsets: 
           (i) if the child is or will be part of an assistance unit 
        receiving an AFDC, MFIP-S, or other MFIP grant, the portion of 
        the AFDC or MFIP standard relating to the child; 
           (ii) Supplemental Security Income payments received by or 
        on behalf of the child; 
           (iii) veteran's benefits received by or on behalf of the 
        child; and 
           (iv) any other income of the child, including child support 
        payments made on behalf of the child. 
           (3) The relative custody assistance payment to be made to 
        the relative custodian shall be a percentage of the net maximum 
        assistance rate calculated in clause (2) based upon the gross 
        income of the relative custodian's family, including the child 
        for whom the relative has permanent legal and physical custody.  
        In no case shall the amount of the relative custody assistance 
        payment exceed that which the child could qualify for under the 
        adoption assistance program if an adoption assistance agreement 
        were entered on the child's behalf.  The relative custody 
        assistance payment shall be calculated as follows: 
           (i) if the relative custodian's gross family income is less 
        than or equal to 200 percent of federal poverty guidelines, the 
        relative custody assistance payment shall be the full amount of 
        the net maximum assistance rate; 
           (ii) if the relative custodian's gross family income is 
        greater than 200 percent and less than or equal to 225 percent 
        of federal poverty guidelines, the relative custody assistance 
        payment shall be 80 percent of the net maximum assistance rate; 
           (iii) if the relative custodian's gross family income is 
        greater than 225 percent and less than or equal to 250 percent 
        of federal poverty guidelines, the relative custody assistance 
        payment shall be 60 percent of the net maximum assistance rate; 
           (iv) if the relative custodian's gross family income is 
        greater than 250 percent and less than or equal to 275 percent 
        of federal poverty guidelines, the relative custody assistance 
        payment shall be 40 percent of the net maximum assistance rate; 
           (v) if the relative custodian's gross family income is 
        greater than 275 percent and less than or equal to 300 percent 
        of federal poverty guidelines, the relative custody assistance 
        payment shall be 20 percent of the net maximum assistance rate; 
        or 
           (vi) if the relative custodian's gross family income is 
        greater than 300 percent of federal poverty guidelines, no 
        relative custody assistance payment shall be made. 
           (b) This paragraph specifies the provisions pertaining to 
        the relationship between relative custody assistance and AFDC, 
        MFIP-S, or other MFIP programs: 
           (1) the relative custodian of a child for whom the relative 
        is receiving relative custody assistance is expected to seek 
        whatever assistance is available for the child through the AFDC, 
        MFIP-S, or other MFIP programs program.  If a relative custodian 
        fails to apply for assistance through AFDC, MFIP-S, or other the 
        MFIP program for which the child is eligible, the child's 
        portion of the AFDC or MFIP standard will be calculated as if 
        application had been made and assistance received; 
           (2) the portion of the AFDC or MFIP standard relating to 
        each child for whom relative custody assistance is being 
        received shall be calculated as follows: 
           (i) determine the total AFDC or MFIP standard for the 
        assistance unit; 
           (ii) determine the amount that the AFDC or MFIP standard 
        would have been if the assistance unit had not included the 
        children for whom relative custody assistance is being received; 
           (iii) subtract the amount determined in item (ii) from the 
        amount determined in item (i); and 
           (iv) divide the result in item (iii) by the number of 
        children for whom relative custody assistance is being received 
        that are part of the assistance unit; or 
           (3) if a child for whom relative custody assistance is 
        being received is not eligible for assistance through the AFDC, 
        MFIP-S, or other MFIP programs program, the portion of AFDC or 
        MFIP standard relating to that child shall be equal to zero. 
           Sec. 113.  Minnesota Statutes 1998, section 257.85, 
        subdivision 11, is amended to read: 
           Subd. 11.  [FINANCIAL CONSIDERATIONS.] (a) Payment of 
        relative custody assistance under a relative custody assistance 
        agreement is subject to the availability of state funds and 
        payments may be reduced or suspended on order of the 
        commissioner if insufficient funds are available. 
           (b) Upon receipt from a local agency of a claim for 
        reimbursement, the commissioner shall reimburse the local agency 
        in an amount equal to 100 percent of the relative custody 
        assistance payments provided to relative custodians.  The local 
        agency may not seek and the commissioner shall not provide 
        reimbursement for the administrative costs associated with 
        performing the duties described in subdivision 4. 
           (c) For the purposes of determining eligibility or payment 
        amounts under the AFDC program, MFIP-S, and other MFIP programs 
        as of July 16, 1996, relative custody assistance payments shall 
        be considered excluded income. 
           Sec. 114.  Minnesota Statutes 1998, section 259.67, 
        subdivision 4, is amended to read: 
           Subd. 4.  [ELIGIBILITY CONDITIONS.] (a) The placing agency 
        shall use the AFDC requirements as specified in federal law as 
        of July 16, 1996, when determining the child's eligibility for 
        adoption assistance under title IV-E of the Social Security 
        Act.  If the child does not qualify, the placing agency shall 
        certify a child as eligible for state funded adoption assistance 
        only if the following criteria are met:  
           (1) Due to the child's characteristics or circumstances it 
        would be difficult to provide the child an adoptive home without 
        adoption assistance.  
           (2)(i) A placement agency has made reasonable efforts to 
        place the child for adoption without adoption assistance, but 
        has been unsuccessful; or 
           (ii) the child's licensed foster parents desire to adopt 
        the child and it is determined by the placing agency that the 
        adoption is in the best interest of the child. 
           (3) The child has been a ward of the commissioner or a 
        Minnesota-licensed child-placing agency.  
           (b) For purposes of this subdivision, the characteristics 
        or circumstances that may be considered in determining whether a 
        child is a child with special needs under United States Code, 
        title 42, chapter 7, subchapter IV, part E, or meets the 
        requirements of paragraph (a), clause (1), are the following: 
           (1) The child is a member of a sibling group to be placed 
        as one unit in which at least one sibling is older than 15 
        months of age or is described in clause (2) or (3). 
           (2) The child has documented physical, mental, emotional, 
        or behavioral disabilities. 
           (3) The child has a high risk of developing physical, 
        mental, emotional, or behavioral disabilities. 
           (c) When a child's eligibility for adoption assistance is 
        based upon the high risk of developing physical, mental, 
        emotional, or behavioral disabilities, payments shall not be 
        made under the adoption assistance agreement unless and until 
        the potential disability manifests itself as documented by an 
        appropriate health care professional. 
           Sec. 115.  Minnesota Statutes 1998, section 260.38, is 
        amended to read: 
           260.38 [COST, PAYMENT.] 
           In addition to the usual care and services given by public 
        and private agencies, the necessary cost incurred by the 
        commissioner of human services in providing care for such child 
        shall be paid by the county committing such child which, subject 
        to uniform rules established by the commissioner of human 
        services, may receive a reimbursement not exceeding one-half of 
        such costs from funds made available for this purpose by the 
        legislature during the period beginning July 1, 1985, and ending 
        December 31, 1985.  Beginning January 1, 1986, the necessary 
        cost incurred by the commissioner of human services in providing 
        care for the child must be paid by the county committing the 
        child.  Where such child is eligible to receive a grant of aid 
        to families with dependent children, Minnesota family investment 
        program-statewide program or supplemental security income for 
        the aged, blind, and disabled, or a foster care maintenance 
        payment under title IV-E of the Social Security Act, United 
        States Code, title 42, sections 670 to 676, the child's needs 
        shall be met through these programs.  
           Sec. 116.  Minnesota Statutes 1998, section 261.063, is 
        amended to read: 
           261.063 [TAX LEVY FOR SOCIAL SECURITY MEASURES; DUTIES OF 
        COUNTY BOARD.] 
           The board of county commissioners of each county shall 
        annually levy taxes and fix a rate sufficient to produce the 
        full amount required for poor relief, general assistance, aid to 
        dependent children Minnesota family investment program, county 
        share of county and state supplemental aid to supplemental 
        security income applicants or recipients, and any other social 
        security measures wherein there is now or may hereafter be 
        county participation, sufficient to produce the full amount 
        necessary for each such item, including administrative expenses, 
        for the ensuing year, within the time fixed by law in addition 
        to all other tax levies and tax rates, however fixed or 
        determined, and any commissioner who shall fail to comply 
        herewith shall be guilty of a gross misdemeanor and shall be 
        immediately removed from office by the governor.  
           Sec. 117.  Minnesota Statutes 1998, section 268.0111, 
        subdivision 5, is amended to read: 
           Subd. 5.  [INCOME MAINTENANCE AND SUPPORT SERVICES.] 
        "Income maintenance and support services" means programs through 
        which the state or its subdivisions provide direct financial or 
        in-kind support to unemployed or underemployed persons, 
        including reemployment insurance, aid to families with dependent 
        children, Minnesota family investment program-statewide program, 
        general assistance, food stamps, energy assistance, disability 
        determinations, and child care.  Income maintenance and support 
        services do not include medical assistance, aging services, 
        social services, community social services, mental health 
        services, or services for the emotionally disturbed, the 
        mentally retarded, or residents of nursing homes. 
           Sec. 118.  Minnesota Statutes 1998, section 268.0111, 
        subdivision 7, is amended to read: 
           Subd. 7.  [PUBLIC ASSISTANCE.] "Public assistance" 
        means aid to families with dependent children, Minnesota family 
        investment program-statewide, program and general assistance.  
           Sec. 119.  Minnesota Statutes 1998, section 268.0122, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DUTIES AS STATE AGENCY.] The commissioner shall: 
           (1) administer the reemployment insurance benefits laws and 
        related programs; 
           (2) administer the aspects of aid to families with 
        dependent children, Minnesota family investment 
        program-statewide program, general assistance, and food stamps 
        that relate to employment and training services, subject to the 
        contract under section 268.86, subdivision 2; 
           (3) administer wage subsidies and the discretionary 
        employment and training fund; 
           (4) administer a national system of public employment 
        offices as prescribed by United States Code, title 29, chapter 
        4B, the Wagner-Peyser Act, and other federal employment and 
        training programs; 
           (5) cooperate with the federal government and its 
        employment and training agencies in any reasonable manner as 
        necessary to qualify for federal aid for employment and training 
        services and money; 
           (6) enter into agreements with other departments of the 
        state and local units of government as necessary; 
           (7) certify employment and training service providers and 
        decertify service providers that fail to comply with performance 
        criteria according to standards established by the commissioner; 
           (8) provide consistent, integrated employment and training 
        services across the state; 
           (9) establish the standards for all employment and training 
        services administered under this chapter; 
           (10) develop standards for the contents and structure of 
        the local service unit plans and plans for Indian tribe 
        employment and training services; 
           (11) provide current state and substate labor market 
        information and forecasts, in cooperation with other agencies; 
           (12) identify underserved populations, unmet service needs, 
        and funding requirements; 
           (13) consult with the council for the blind on matters 
        pertaining to programs and services for the blind and visually 
        impaired; and 
           (14) enter into agreements with Indian tribes as necessary 
        to provide employment and training services as funds become 
        available. 
           Sec. 120.  Minnesota Statutes 1998, section 268.552, 
        subdivision 5, is amended to read: 
           Subd. 5.  [ALLOCATION TO APPLICANTS.] Priority for 
        subsidies shall be in the following order: 
           (1) applicants living in households with no other income 
        source; 
           (2) applicants whose incomes and resources are less than 
        the standard for eligibility for general assistance; and 
           (3) applicants who are eligible for aid to families with 
        dependent children or Minnesota family investment 
        program-statewide program. 
           Sec. 121.  Minnesota Statutes 1998, section 268.672, 
        subdivision 6, is amended to read: 
           Subd. 6.  [ELIGIBLE JOB APPLICANT.] "Eligible job 
        applicant" means a person who:  
           (1) has attempted to secure a nonsubsidized job by 
        completing comprehensive job readiness and is: 
           (i) a temporary assistance for needy families 
        (TANF) Minnesota family investment program recipient who is 
        making good faith efforts to comply with the family support 
        agreement a job search support plan as defined under 
        section 256.032, subdivision 7a 256J.52, subdivision 3, or an 
        employment plan as defined under section 256J.52, subdivision 5, 
        but has failed to find suitable employment; or 
           (ii) a family general assistance recipient; 
           (2) is a member of a household supported only by: 
           (i) a low-income worker; or 
           (ii) a person who is underemployed as that term is defined 
        in section 268.61, subdivision 5; or 
           (3) is a member of a family that is eligible for, but not 
        receiving public assistance. 
           Sec. 122.  Minnesota Statutes 1998, section 268.86, 
        subdivision 2, is amended to read: 
           Subd. 2.  [INTERAGENCY AGREEMENTS.] By October 1, 1987, the 
        commissioner and the commissioner of human services shall enter 
        into a written contract for the design, delivery, and 
        administration of employment and training services for 
        applicants for or recipients of food stamps, aid to families 
        with dependent children or Minnesota family investment 
        program-statewide program, including AFDC and MFIP-S employment 
        and training programs and general assistance.  The contract must 
        address: 
           (1) specific roles and responsibilities of each department; 
           (2) assignment and supervision of staff for interagency 
        activities including any necessary interagency employee mobility 
        agreements under the administrative procedures of the department 
        of employee relations; 
           (3) mechanisms for determining the conditions under which 
        individuals participate in services, their rights and 
        responsibilities while participating, and the standards by which 
        the services must be administered; 
           (4) procedures for providing technical assistance to local 
        service units, Indian tribes, and employment and training 
        service providers; 
           (5) access to appropriate staff for ongoing development and 
        interpretation of policy, rules, and program standards; 
           (6) procedures for reimbursing appropriate agencies for 
        administrative expenses; and 
           (7) procedures for accessing available federal funds. 
           Sec. 123.  Minnesota Statutes 1998, section 268.871, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [RESPONSIBILITY AND CERTIFICATION.] (a) 
        Unless prohibited by federal law or otherwise determined by 
        state law, a local service unit is responsible for the delivery 
        of employment and training services.  After February 1, 1988, 
        employment and training services must be delivered by certified 
        employment and training service providers.  
           (b) The local service unit's employment and training 
        service provider must meet the certification standards in this 
        subdivision in order to be certified to deliver any of the 
        following employment and training services and programs:  wage 
        subsidies; general assistance grant diversion; food stamp 
        employment and training programs; community work experience 
        programs; AFDC or MFIP-S MFIP job search; AFDC or MFIP-S MFIP 
        grant diversion; AFDC or MFIP-S MFIP on-the-job training; and 
        AFDC or MFIP-S MFIP case management.  
           (c) The commissioner shall certify a local service unit's 
        service provider to provide these employment and training 
        services and programs if the commissioner determines that the 
        provider has:  
           (1) past experience in direct delivery of the programs 
        specified in paragraph (b); 
           (2) staff capabilities and qualifications, including 
        adequate staff to provide timely and effective services to 
        clients, and proven staff experience in providing specific 
        services such as assessments, career planning, job development, 
        job placement, support services, and knowledge of community 
        services and educational resources; 
           (3) demonstrated effectiveness in providing services to 
        public assistance recipients and other economically 
        disadvantaged clients; and 
           (4) demonstrated administrative capabilities, including 
        adequate fiscal and accounting procedures, financial management 
        systems, participant data systems, and record retention 
        procedures. 
           (d) When the only service provider that meets the criterion 
        in paragraph (c), clause (1), has been decertified, according to 
        subdivision 1a, in that local service unit, the following 
        criteria shall be substituted:  past experience in direct 
        delivery of multiple, coordinated, nonduplicative services, 
        including outreach, assessments, identification of client 
        barriers, employability development plans, and provision or 
        referral to support services. 
           (e) The commissioner shall certify providers of the 
        Minnesota family investment plan case management services as 
        defined in section 256.032, subdivision 3.  Providers must meet 
        the standards defined in paragraph (c), except that past 
        experience under paragraph (c), clause (1), must be in services 
        and programs similar to those specified in section 256.032, 
        subdivision 3.  
           Employment and training service providers shall be 
        certified by the commissioner for two fiscal years beginning 
        July 1, 1991, and every second year thereafter. 
           Sec. 124.  Minnesota Statutes 1998, section 268.90, 
        subdivision 2, is amended to read: 
           Subd. 2.  [EMPLOYMENT CONDITIONS.] (a) An eligible 
        nonprofit or public employer may not terminate, lay off, or 
        reduce the regular working hours of an employee for the purpose 
        of hiring an individual with money available under this 
        program.  An eligible employer may not hire an individual with 
        money available through this program if any other person is on 
        layoff from the same or a substantially equivalent job. 
           (b) Community investment program participants are employees 
        of the project employer within the meaning of workers' 
        compensation laws, personal income tax, and the Federal 
        Insurance Contribution Act, but not retirement or civil service 
        laws. 
           (c) Each project and job must comply with all applicable 
        affirmative action, fair labor, health, safety, and 
        environmental standards. 
           (d) Individuals employed under the community investment 
        program must be paid a wage at the same wage rates as work site 
        or employees doing comparable work in that locality, unless 
        otherwise specified in law. 
           (e) Recipients of aid to families with dependent children 
        or Minnesota family investment program-statewide who are 
        eligible on the basis of an unemployed parent may not have 
        available more than 100 hours a month.  All employees are 
        limited to 32 hours or four days a week, so that they can 
        continue to seek full-time private sector employment, unless 
        otherwise specified in law. 
           (f) The commissioner shall establish, by rule, the terms 
        and conditions governing the participation of appropriate public 
        assistance recipients.  The rules must, at a minimum, establish 
        the procedures by which the minimum and maximum number of work 
        hours and maximum allowable travel distances are determined, the 
        amounts and methods by which work expenses will be paid, and the 
        manner in which support services will be provided.  The rules 
        must also provide for periodic reviews of clients continuing 
        employment in community investment programs. 
           (g) Participation in a community investment program by a 
        recipient of aid to families with dependent children, Minnesota 
        family investment program-statewide, program assistance or 
        general assistance is voluntary.  
           Sec. 125.  Minnesota Statutes 1998, section 268.95, 
        subdivision 4, is amended to read: 
           Subd. 4.  [PILOT PROGRAM.] The commissioner shall develop a 
        pilot program, in cooperation with the commissioners of trade 
        and economic development and human services, to enable 
        low-income persons to start or expand self-employment 
        opportunities or home-based businesses that are designed to make 
        the individual entrepreneurs economically independent.  The 
        commissioner of human services shall seek necessary waivers from 
        federal regulations to allow recipients of aid to families with 
        dependent children or Minnesota family investment 
        program-statewide program assistance to participate and retain 
        eligibility while establishing a business. 
           Sec. 126.  Minnesota Statutes 1998, section 275.065, 
        subdivision 5a, is amended to read: 
           Subd. 5a.  [PUBLIC ADVERTISEMENT.] (a) A city that has a 
        population of more than 2,500, county, a metropolitan special 
        taxing district as defined in subdivision 3, paragraph (i), a 
        regional library district established under section 134.201, or 
        school district shall advertise in a newspaper a notice of its 
        intent to adopt a budget and property tax levy or, in the case 
        of a school district, to review its current budget and proposed 
        property taxes payable in the following year, at a public 
        hearing.  The notice must be published not less than two 
        business days nor more than six business days before the hearing.
           The advertisement must be at least one-eighth page in size 
        of a standard-size or a tabloid-size newspaper.  The 
        advertisement must not be placed in the part of the newspaper 
        where legal notices and classified advertisements appear.  The 
        advertisement must be published in an official newspaper of 
        general circulation in the taxing authority.  The newspaper 
        selected must be one of general interest and readership in the 
        community, and not one of limited subject matter.  The 
        advertisement must appear in a newspaper that is published at 
        least once per week.  
           For purposes of this section, the metropolitan special 
        taxing district's advertisement must only be published in the 
        Minneapolis Star and Tribune and the Saint Paul Pioneer Press. 
           (b) The advertisement for school districts, metropolitan 
        special taxing districts, and regional library districts must be 
        in the following form, except that the notice for a school 
        district may include references to the current budget in regard 
        to proposed property taxes. 
                                   "NOTICE OF
                            PROPOSED PROPERTY TAXES
                         (School District/Metropolitan
                        Special Taxing District/Regional
                         Library District) of .........
        The governing body of ........ will soon hold budget hearings 
        and vote on the property taxes for (metropolitan special taxing 
        district/regional library district services that will be 
        provided in (year)/school district services that will be 
        provided in (year) and (year)). 
                           NOTICE OF PUBLIC HEARING:
        All concerned citizens are invited to attend a public hearing 
        and express their opinions on the proposed (school 
        district/metropolitan special taxing district/regional library 
        district) budget and property taxes, or in the case of a school 
        district, its current budget and proposed property taxes, 
        payable in the following year.  The hearing will be held on 
        (Month/Day/Year) at (Time) at (Location, Address)." 
           (c) The advertisement for cities and counties must be in 
        the following form. 
                              "NOTICE OF PROPOSED
                        TOTAL BUDGET AND PROPERTY TAXES
        The (city/county) governing body or board of commissioners will 
        hold a public hearing to discuss the budget and to vote on the 
        amount of property taxes to collect for services the 
        (city/county) will provide in (year). 
           
        SPENDING:  The total budget amounts below compare 
        (city's/county's) (year) total actual budget with the amount the 
        (city/county) proposes to spend in (year). 
           
        (Year) Total          Proposed (Year)          Change from
        Actual Budget             Budget               (Year)-(Year)
           
          $.......              $.......                ...%
           
        TAXES:  The property tax amounts below compare that portion of 
        the current budget levied in property taxes in (city/county) for 
        (year) with the property taxes the (city/county) proposes to 
        collect in (year). 
           
        (Year) Property       Proposed (Year)          Change from
            Taxes              Property Taxes         (Year)-(Year)
           
          $.......              $.......                ...% 
           
                           ATTEND THE PUBLIC HEARING
        All (city/county) residents are invited to attend the public 
        hearing of the (city/county) to express your opinions on the 
        budget and the proposed amount of (year) property taxes.  The 
        hearing will be held on: 
                             (Month/Day/Year/Time)
                               (Location/Address)
        If the discussion of the budget cannot be completed, a time and 
        place for continuing the discussion will be announced at the 
        hearing.  You are also invited to send your written comments to: 
                                 (City/County)
                              (Location/Address)"
           (d) For purposes of this subdivision, the budget amounts 
        listed on the advertisement mean: 
           (1) for cities, the total government fund expenditures, as 
        defined by the state auditor under section 471.6965, less any 
        expenditures for improvements or services that are specially 
        assessed or charged under chapter 429, 430, 435, or the 
        provisions of any other law or charter; and 
           (2) for counties, the total government fund expenditures, 
        as defined by the state auditor under section 375.169, less any 
        expenditures for direct payments to recipients or providers for 
        the human service aids listed below: 
           (1) aid to families with dependent children under sections 
        256.82, subdivision 1, and 256.935, subdivision 1 (i) Minnesota 
        family investment program under chapters 256J and 256K; 
           (2) (ii) medical assistance under sections 256B.041, 
        subdivision 5, and 256B.19, subdivision 1; 
           (3) (iii) general assistance medical care under section 
        256D.03, subdivision 6; 
           (4) (iv) general assistance under section 256D.03, 
        subdivision 2; 
           (5) (v) emergency assistance under section 256.871, 
        subdivision 6 256J.48; 
           (6) (vi) Minnesota supplemental aid under section 256D.36, 
        subdivision 1; 
           (7) (vii) preadmission screening under section 256B.0911, 
        and alternative care grants under section 256B.0913; 
           (8) (viii) general assistance medical care claims 
        processing, medical transportation and related costs under 
        section 256D.03, subdivision 4; 
           (9) (ix) medical transportation and related costs under 
        section 256B.0625, subdivisions 17 to 18a; 
           (10) (x) group residential housing under 256I.05, 
        subdivision 8, transferred from programs in clauses (4) (iv) and 
        (6) (vi); or 
           (11) (xi) any successor programs to those listed in clauses 
        (1) (i) to (10) (x). 
           (e) A city with a population of over 500 but not more than 
        2,500 must advertise by posted notice as defined in section 
        645.12, subdivision 1.  The advertisement must be posted at the 
        time provided in paragraph (a).  It must be in the form required 
        in paragraph (b). 
           (f) For purposes of this subdivision, the population of a 
        city is the most recent population as determined by the state 
        demographer under section 4A.02. 
           (g) The commissioner of revenue, subject to the approval of 
        the chairs of the house and senate tax committees, shall 
        prescribe the form and format of the advertisement. 
           Sec. 127.  Minnesota Statutes 1998, section 290.067, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AMOUNT OF CREDIT.] (a) A taxpayer may take 
        as a credit against the tax due from the taxpayer and a spouse, 
        if any, under this chapter an amount equal to the dependent care 
        credit for which the taxpayer is eligible pursuant to the 
        provisions of section 21 of the Internal Revenue Code subject to 
        the limitations provided in subdivision 2 except that in 
        determining whether the child qualified as a dependent, income 
        received as an aid to families with dependent children a 
        Minnesota family investment program grant or allowance to or on 
        behalf of the child, or as a grant or allowance to or on behalf 
        of the child under the successor program pursuant to Public Law 
        104-193, must not be taken into account in determining whether 
        the child received more than half of the child's support from 
        the taxpayer, and the provisions of section 32(b)(1)(D) of the 
        Internal Revenue Code do not apply. 
           (b) If a child who has not attained the age of six years at 
        the close of the taxable year is cared for at a licensed family 
        day care home operated by the child's parent, the taxpayer is 
        deemed to have paid employment-related expenses.  If the child 
        is 16 months old or younger at the close of the taxable year, 
        the amount of expenses deemed to have been paid equals the 
        maximum limit for one qualified individual under section 21(c) 
        and (d) of the Internal Revenue Code.  If the child is older 
        than 16 months of age but has not attained the age of six years 
        at the close of the taxable year, the amount of expenses deemed 
        to have been paid equals the amount the licensee would charge 
        for the care of a child of the same age for the same number of 
        hours of care.  
           (c) If a married couple: 
           (1) has a child who has not attained the age of one year at 
        the close of the taxable year; 
           (2) files a joint tax return for the taxable year; and 
           (3) does not participate in a dependent care assistance 
        program as defined in section 129 of the Internal Revenue Code, 
        in lieu of the actual employment related expenses paid for that 
        child under paragraph (a) or the deemed amount under paragraph 
        (b), the lesser of (i) the combined earned income of the couple 
        or (ii) $2,400 will be deemed to be the employment related 
        expense paid for that child.  The earned income limitation of 
        section 21(d) of the Internal Revenue Code shall not apply to 
        this deemed amount.  These deemed amounts apply regardless of 
        whether any employment-related expenses have been paid.  
           (d) If the taxpayer is not required and does not file a 
        federal individual income tax return for the tax year, no credit 
        is allowed for any amount paid to any person unless: 
           (1) the name, address, and taxpayer identification number 
        of the person are included on the return claiming the credit; or 
           (2) if the person is an organization described in section 
        501(c)(3) of the Internal Revenue Code and exempt from tax under 
        section 501(a) of the Internal Revenue Code, the name and 
        address of the person are included on the return claiming the 
        credit.  
        In the case of a failure to provide the information required 
        under the preceding sentence, the preceding sentence does not 
        apply if it is shown that the taxpayer exercised due diligence 
        in attempting to provide the information required. 
           In the case of a nonresident, part-year resident, or a 
        person who has earned income not subject to tax under this 
        chapter, the credit determined under section 21 of the Internal 
        Revenue Code must be allocated based on the ratio by which the 
        earned income of the claimant and the claimant's spouse from 
        Minnesota sources bears to the total earned income of the 
        claimant and the claimant's spouse. 
           Sec. 128.  Minnesota Statutes 1998, section 290A.03, 
        subdivision 7, is amended to read: 
           Subd. 7.  [DEPENDENT.] "Dependent" means any person who is 
        considered a dependent under sections 151 and 152 of the 
        Internal Revenue Code.  In the case of a son, stepson, daughter, 
        or stepdaughter of the claimant, amounts received as an aid to 
        families with dependent children a Minnesota family investment 
        program grant, allowance to or on behalf of the child, or as a 
        grant or allowance to or on behalf of the child under the 
        successor program pursuant to Public Law Number 104-193, surplus 
        food, or other relief in kind supplied by a governmental agency 
        must not be taken into account in determining whether the child 
        received more than half of the child's support from the claimant.
           Sec. 129.  Minnesota Statutes 1998, section 393.07, 
        subdivision 6, is amended to read: 
           Subd. 6.  [PURCHASE OF EQUIPMENT TO AID WELFARE 
        RECIPIENTS.] Every local social services agency authorizing 
        braces, crutches, trusses, wheel chairs and hearing aids for use 
        by recipients of supplemental security income for the aged, 
        blind and disabled, aid to families with dependent children or 
        Minnesota family investment program-statewide program and relief 
        shall secure such devices at the lowest cost obtainable 
        conducive to the well being of the recipient and fix the 
        recipient's grant in an amount to cover the cost of the device 
        providing it will be purchased at the lowest cost obtainable, or 
        may make payment for the device directly to the vendor. 
           Sec. 130.  Minnesota Statutes 1998, section 462A.205, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] For the purposes of this section, 
        the following terms have the meanings given them. 
           (a) "Caretaker parent" means a parent, relative caretaker, 
        or minor caretaker as defined by the aid to families with 
        dependent children program, sections 256.72 to 256.87, or its 
        successor program Minnesota family investment program, chapter 
        256J. 
           (b) "County agency" means the agency designated by the 
        county board to implement financial assistance for current 
        public assistance programs and for the Minnesota family 
        investment program statewide. 
           (c) "Counties with high average housing costs" means 
        counties whose average federal section 8 fair market rents as 
        determined by the Department of Housing and Urban Development 
        are in the highest one-third of average rents in the state. 
           (d) "Designated rental property" is rental property (1) 
        that is made available by a self-sufficiency program for use by 
        participating families and meets federal section 8 existing 
        quality standards, or (2) that has received federal, state, or 
        local rental rehabilitation assistance since January 1, 1987, 
        and meets federal section 8 existing housing quality standards. 
           (e) "Earned income" for a family receiving rental 
        assistance under this section means cash or in-kind income 
        earned through the receipt of wages, salary, commissions, profit 
        from employment activities, net profit from self-employment 
        activities, payments made by an employer for regularly accrued 
        vacation or sick leave, and any other profit from activity 
        earned through effort or labor. 
           (f) "Family or participating family" means: 
           (1) a family with a caretaker parent who is participating 
        in a self-sufficiency program and with at least one minor child; 
           (2) a family that, at the time it began receiving rent 
        assistance under this section, had a caretaker parent 
        participating in a self-sufficiency program and had at least one 
        minor child; 
           (3) a family with a caretaker parent who is receiving 
        public assistance and has earned income and with at least one 
        minor child; or 
           (4) a family that, at the time it began receiving rent 
        assistance under this section, had a caretaker parent who had 
        earned income and at least one minor child. 
           (g) "Gross family income" for a family receiving rental 
        assistance under this section means the gross amount of the 
        wages, salaries, social security payments, pensions, workers' 
        compensation, reemployment insurance, public assistance 
        payments, alimony, child support, and income from assets 
        received by the family. 
           (h) "Local housing organization" means the agency of local 
        government responsible for administering the Department of 
        Housing and Urban Development's section 8 existing voucher and 
        certificate program or a nonprofit or for-profit organization 
        experienced in housing management. 
           (i) "Public assistance" means aid to families with 
        dependent children, or its successor program, family general 
        assistance, or its successor program, or family work readiness, 
        or its successor the Minnesota family investment program. 
           (j) "Self-sufficiency program" means a program operated by 
        an employment and training service provider as defined in 
        chapter 256J, an employability program administered by a 
        community action agency, or courses of study at an accredited 
        institution of higher education pursued with at least half-time 
        student status. 
           Sec. 131.  Minnesota Statutes 1998, section 462A.222, 
        subdivision 1a, is amended to read: 
           Subd. 1a.  [DETERMINATION OF REGIONAL CREDIT POOLS.] The 
        agency shall divide the annual per capita amount used in 
        determining the state ceiling for low-income housing tax credits 
        provided under section 42 of the Internal Revenue Code of 1986, 
        as amended, into a metropolitan pool and a greater Minnesota 
        pool.  The metropolitan pool shall serve the metropolitan area 
        as defined in section 473.121, subdivision 2.  The greater 
        Minnesota pool shall serve the remaining counties of the state.  
        The percentage of the annual per capita amount allotted to each 
        pool must be determined as follows: 
           (a) The percentage set-aside for projects involving a 
        qualified nonprofit organization as provided in section 42 of 
        the Internal Revenue Code of 1986, as amended, must be deducted 
        from the annual per capita amount used in determining the state 
        ceiling. 
           (b) Of the remaining amount, the metropolitan pool must be 
        allotted a percentage equal to the metropolitan counties' 
        percentage of the total number of state recipients of:  aid to 
        families with dependent children the Minnesota family investment 
        program, general assistance, Minnesota supplemental aid, and 
        supplemental security income in the state, as reported annually 
        by the department of human services.  The greater Minnesota pool 
        must be allotted the amount remaining after the metropolitan 
        pool's percentage has been allotted. 
           The set-aside for qualified nonprofit organizations must be 
        divided between the two regional pools in the same percentage as 
        determined for the credit amounts above. 
           Sec. 132.  Minnesota Statutes 1998, section 473.129, 
        subdivision 8, is amended to read: 
           Subd. 8.  [INSURANCE.] The council may provide for 
        self-insurance or otherwise provide for insurance relating to 
        any of its property, rights, or revenue, workers' compensation, 
        public liability, or any other risk or hazard arising from its 
        activities, and may provide for insuring any of its officers or 
        employees against the risk or hazard at the expense of the 
        council.  If the council provides for self-insurance, against 
        its liability and the liability of its officers, employees, and 
        agents for damages resulting from its torts and those of its 
        officers, employees, and agents, including its obligation to pay 
        basic economic loss benefits under sections 65B.41 to 65B.71, it 
        shall be entitled to deduct from damages and basic economic loss 
        benefits all money paid or payable to the persons seeking 
        damages and benefits from all governmental entities providing 
        medical, hospital, and disability benefits except for payments 
        made under the aid to families with dependent children Minnesota 
        family investment program or medical assistance programs program.
           Sec. 133.  Minnesota Statutes 1998, section 477A.0122, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] For purposes of this section, the 
        following definitions apply: 
           (a) "Children in out-of-home placement" means the total 
        unduplicated number of children in out-of-home care as reported 
        according to section 257.0725. 
           (b) "Family preservation programs" means family-based 
        services as defined in section 256F.03, subdivision 5, families 
        first services, parent and child education programs, and day 
        treatment services provided in cooperation with a school 
        district or other programs as defined by the commissioner of 
        human services. 
           (c) "Income maintenance caseload" means average monthly 
        number of AFDC or Minnesota family investment program-statewide 
        program cases for the calendar year. 
           By July 1, 1994, the commissioner of human services shall 
        certify to the commissioner of revenue the number of children in 
        out-of-home placement in 1991 and 1992 for each county and the 
        income maintenance caseload for each county for the most recent 
        year available.  By July 1 of each subsequent year, the 
        commissioner of human services shall certify to the commissioner 
        of revenue the income maintenance caseload for each county for 
        the most recent calendar year available. 
           Sec. 134.  Minnesota Statutes 1998, section 501B.89, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SUPPLEMENTAL TRUSTS FOR PERSONS WITH 
        DISABILITIES.] (a) It is the public policy of this state to 
        enforce supplemental needs trusts as provided in this 
        subdivision. 
           (b) For purposes of this subdivision, a "supplemental needs 
        trust" is a trust created for the benefit of a person with a 
        disability and funded by someone other than the trust 
        beneficiary, the beneficiary's spouse, or anyone obligated to 
        pay any sum for damages or any other purpose to or for the 
        benefit of the trust beneficiary under the terms of a settlement 
        agreement or judgment. 
           (c) For purposes of this subdivision, a "person with a 
        disability" means a person who, prior to creation of a trust 
        which otherwise qualifies as a supplemental needs trust for the 
        person's benefit: 
           (1) is considered to be a person with a disability under 
        the disability criteria specified in Title II or Title XVI of 
        the Social Security Act; or 
           (2) has a physical or mental illness or condition which, in 
        the expected natural course of the illness or condition, either 
        prior to or following creation of the trust, to a reasonable 
        degree of medical certainty, is expected to: 
           (i) last for a continuous period of 12 months or more; and 
           (ii) substantially impair the person's ability to provide 
        for the person's care or custody. 
           Disability may be established conclusively for purposes of 
        this subdivision by the written opinion of a licensed 
        professional who is qualified to diagnose the illness or 
        condition, confirmed by the written opinion of a second licensed 
        professional who is qualified to diagnose the illness or 
        condition. 
           (d) The general purpose of a supplemental needs trust must 
        be to provide for the reasonable living expenses and other basic 
        needs of a person with a disability when benefits from publicly 
        funded benefit programs are not sufficient to provide adequately 
        for those needs.  Subject to the restrictions contained in this 
        paragraph, a supplemental needs trust may authorize 
        distributions to provide for all or any portion of the 
        reasonable living expenses of the beneficiary.  A supplemental 
        needs trust may allow or require distributions only in ways and 
        for purposes that supplement or complement the benefits 
        available under medical assistance, Minnesota supplemental aid, 
        and other publicly funded benefit programs for disabled 
        persons.  A supplemental needs trust must contain provisions 
        that prohibit disbursements that would have the effect of 
        replacing, reducing, or substituting for publicly funded 
        benefits otherwise available to the beneficiary or rendering the 
        beneficiary ineligible for publicly funded benefits. 
           (e) A supplemental needs trust is not enforceable if the 
        trust beneficiary becomes a patient or resident after age 64 in 
        a state institution or nursing facility for six months or more 
        and, due to the beneficiary's medical need for care in an 
        institutional setting, there is no reasonable expectation that 
        the beneficiary will ever be discharged from the institution or 
        facility.  For purposes of this paragraph "reasonable 
        expectation" means that the beneficiary's attending physician 
        has certified that the expectation is reasonable.  For purposes 
        of this paragraph, a beneficiary participating in a group 
        residential program is not deemed to be a patient or resident in 
        a state institution or nursing facility.  
           (f) The trust income and assets of a supplemental needs 
        trust are considered available to the beneficiary for medical 
        assistance purposes to the extent they are considered available 
        to the beneficiary under medical assistance, supplemental 
        security income, or aid to families with dependent 
        children Minnesota family investment program methodology, 
        whichever is used to determine the beneficiary's eligibility for 
        medical assistance.  For other public assistance programs 
        established or administered under state law, assets and income 
        will be considered available to the beneficiary in accordance 
        with the methodology applicable to the program. 
           (g) Nothing in this subdivision requires submission of a 
        supplemental needs trust to a court for interpretation or 
        enforcement. 
           (h) Paragraphs (a) to (g) apply to supplemental needs 
        trusts whenever created, but the limitations and restrictions in 
        paragraphs (c) to (g) apply only to trusts created after June 
        30, 1993.  
           Sec. 135.  Minnesota Statutes 1998, section 518.171, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ORDER.] Compliance with this section 
        constitutes compliance with a qualified medical child support 
        order as described in the federal Employee Retirement Income 
        Security Act of 1974 (ERISA) as amended by the federal Omnibus 
        Budget Reconciliation Act of 1993 (OBRA).  
           (a) Every child support order must: 
           (1) expressly assign or reserve the responsibility for 
        maintaining medical insurance for the minor children and the 
        division of uninsured medical and dental costs; and 
           (2) contain the names, last known addresses, and social 
        security number of the custodial parent and noncustodial parent, 
        of the dependents unless the court prohibits the inclusion of an 
        address or social security number and orders the custodial 
        parent to provide the address and social security number to the 
        administrator of the health plan.  The court shall order the 
        party with the better group dependent health and dental 
        insurance coverage or health insurance plan to name the minor 
        child as beneficiary on any health and dental insurance plan 
        that is available to the party on: 
           (i) a group basis; 
           (ii) through an employer or union; or 
           (iii) through a group health plan governed under the ERISA 
        and included within the definitions relating to health plans 
        found in section 62A.011, 62A.048, or 62E.06, subdivision 2.  
        "Health insurance" or "health insurance coverage" as used in 
        this section means coverage that is comparable to or better than 
        a number two qualified plan as defined in section 62E.06, 
        subdivision 2.  "Health insurance" or "health insurance 
        coverage" as used in this section does not include medical 
        assistance provided under chapter 256, 256B, 256J, 256K, or 256D.
           (b) If the court finds that dependent health or dental 
        insurance is not available to the obligor or obligee on a group 
        basis or through an employer or union, or that group insurance 
        is not accessible to the obligee, the court may require the 
        obligor (1) to obtain other dependent health or dental 
        insurance, (2) to be liable for reasonable and necessary medical 
        or dental expenses of the child, or (3) to pay no less than $50 
        per month to be applied to the medical and dental expenses of 
        the children or to the cost of health insurance dependent 
        coverage. 
           (c) If the court finds that the available dependent health 
        or dental insurance does not pay all the reasonable and 
        necessary medical or dental expenses of the child, including any 
        existing or anticipated extraordinary medical expenses, and the 
        court finds that the obligor has the financial ability to 
        contribute to the payment of these medical or dental expenses, 
        the court shall require the obligor to be liable for all or a 
        portion of the medical or dental expenses of the child not 
        covered by the required health or dental plan.  Medical and 
        dental expenses include, but are not limited to, necessary 
        orthodontia and eye care, including prescription lenses. 
           (d) Unless otherwise agreed by the parties and approved by 
        the court, if the court finds that the obligee is not receiving 
        public assistance for the child and has the financial ability to 
        contribute to the cost of medical and dental expenses for the 
        child, including the cost of insurance, the court shall order 
        the obligee and obligor to each assume a portion of these 
        expenses based on their proportionate share of their total net 
        income as defined in section 518.54, subdivision 6. 
           (e) Payments ordered under this section are subject to 
        section 518.6111.  An obligee who fails to apply payments 
        received to the medical expenses of the dependents may be found 
        in contempt of this order. 
           Sec. 136.  Minnesota Statutes 1998, section 518.551, 
        subdivision 5, is amended to read: 
           Subd. 5.  [NOTICE TO PUBLIC AUTHORITY; GUIDELINES.] (a) The 
        petitioner shall notify the public authority of all proceedings 
        for dissolution, legal separation, determination of parentage or 
        for the custody of a child, if either party is receiving public 
        assistance or applies for it subsequent to the commencement of 
        the proceeding.  The notice must contain the full names of the 
        parties to the proceeding, their social security account 
        numbers, and their birth dates.  After receipt of the notice, 
        the court shall set child support as provided in this 
        subdivision.  The court may order either or both parents owing a 
        duty of support to a child of the marriage to pay an amount 
        reasonable or necessary for the child's support, without regard 
        to marital misconduct.  The court shall approve a child support 
        stipulation of the parties if each party is represented by 
        independent counsel, unless the stipulation does not meet the 
        conditions of paragraph (i).  In other cases the court shall 
        determine and order child support in a specific dollar amount in 
        accordance with the guidelines and the other factors set forth 
        in paragraph (c) and any departure therefrom.  The court may 
        also order the obligor to pay child support in the form of a 
        percentage share of the obligor's net bonuses, commissions, or 
        other forms of compensation, in addition to, or if the obligor 
        receives no base pay, in lieu of, an order for a specific dollar 
        amount. 
           (b) The court shall derive a specific dollar amount for 
        child support by multiplying the obligor's net income by the 
        percentage indicated by the following guidelines:  
        Net Income Per            Number of Children 
        Month of Obligor 
                      1     2     3     4     5     6    7 or 
                                                         more 
        $550 and Below     Order based on the ability of the 
                           obligor to provide support  
                           at these income levels, or at higher  
                           levels, if the obligor has 
                           the earning ability. 
        $551 - 600   16%   19%   22%   25%   28%   30%   32% 
        $601 - 650   17%   21%   24%   27%   29%   32%   34% 
        $651 - 700   18%   22%   25%   28%   31%   34%   36% 
        $701 - 750   19%   23%   27%   30%   33%   36%   38% 
        $751 - 800   20%   24%   28%   31%   35%   38%   40% 
        $801 - 850   21%   25%   29%   33%   36%   40%   42% 
        $851 - 900   22%   27%   31%   34%   38%   41%   44% 
        $901 - 950   23%   28%   32%   36%   40%   43%   46% 
        $951 - 1000  24%   29%   34%   38%   41%   45%   48% 
        $1001- 5000  25%   30%   35%   39%   43%   47%   50% 
        or the amount 
        in effect under
        paragraph (k)
           Guidelines for support for an obligor with a monthly income 
        in excess of the income limit currently in effect under 
        paragraph (k) shall be the same dollar amounts as provided for 
        in the guidelines for an obligor with a monthly income equal to 
        the limit in effect. 
        Net Income defined as: 
                 
                 Total monthly 
                 income less           *(i) Federal Income Tax 
                                      *(ii) State Income Tax 
                                      (iii) Social Security
                                             Deductions 
                                       (iv) Reasonable
                                             Pension Deductions
                 *Standard 
                 Deductions apply-      (v) Union Dues 
                 use of tax tables     (vi) Cost of Dependent Health
                 recommended                 Insurance Coverage  
                                      (vii) Cost of Individual or Group
                                             Health/Hospitalization
                                             Coverage or an        
                                             Amount for Actual 
                                             Medical Expenses   
                                     (viii) A Child Support or  
                                             Maintenance Order that is
                                             Currently Being Paid. 
           "Net income" does not include: 
           (1) the income of the obligor's spouse, but does include 
        in-kind payments received by the obligor in the course of 
        employment, self-employment, or operation of a business if the 
        payments reduce the obligor's living expenses; or 
           (2) compensation received by a party for employment in 
        excess of a 40-hour work week, provided that: 
           (i) support is nonetheless ordered in an amount at least 
        equal to the guidelines amount based on income not excluded 
        under this clause; and 
           (ii) the party demonstrates, and the court finds, that: 
           (A) the excess employment began after the filing of the 
        petition for dissolution; 
           (B) the excess employment reflects an increase in the work 
        schedule or hours worked over that of the two years immediately 
        preceding the filing of the petition; 
           (C) the excess employment is voluntary and not a condition 
        of employment; 
           (D) the excess employment is in the nature of additional, 
        part-time or overtime employment compensable by the hour or 
        fraction of an hour; and 
           (E) the party's compensation structure has not been changed 
        for the purpose of affecting a support or maintenance obligation.
           The court shall review the work-related and 
        education-related child care costs paid and shall allocate the 
        costs to each parent in proportion to each parent's net income, 
        as determined under this subdivision, after the transfer of 
        child support and spousal maintenance, unless the allocation 
        would be substantially unfair to either parent.  There is a 
        presumption of substantial unfairness if after the sum total of 
        child support, spousal maintenance, and child care costs is 
        subtracted from the noncustodial parent's income, the income is 
        at or below 100 percent of the federal poverty guidelines.  The 
        cost of child care for purposes of this paragraph is 75 percent 
        of the actual cost paid for child care, to reflect the 
        approximate value of state and federal tax credits available to 
        the custodial parent.  The actual cost paid for child care is 
        the total amount received by the child care provider for the 
        child or children of the obligor from the obligee or any public 
        agency.  The court shall require verification of employment or 
        school attendance and documentation of child care expenses from 
        the obligee and the public agency, if applicable.  If child care 
        expenses fluctuate during the year because of seasonal 
        employment or school attendance of the obligee or extended 
        periods of visitation with the obligor, the court shall 
        determine child care expenses based on an average monthly cost.  
        The amount allocated for child care expenses is considered child 
        support but is not subject to a cost-of-living adjustment under 
        section 518.641.  The amount allocated for child care expenses 
        terminates when either party notifies the public authority that 
        the child care costs have ended and without any legal action on 
        the part of either party.  The public authority shall verify the 
        information received under this provision before authorizing 
        termination.  The termination is effective as of the date of the 
        notification.  In other cases where there is a substantial 
        increase or decrease in child care expenses, the parties may 
        modify the order under section 518.64. 
           The court may allow the noncustodial parent to care for the 
        child while the custodial parent is working, as provided in 
        section 518.175, subdivision 8.  Allowing the noncustodial 
        parent to care for the child under section 518.175, subdivision 
        8, is not a reason to deviate from the guidelines. 
           (c) In addition to the child support guidelines, the court 
        shall take into consideration the following factors in setting 
        or modifying child support or in determining whether to deviate 
        from the guidelines: 
           (1) all earnings, income, and resources of the parents, 
        including real and personal property, but excluding income from 
        excess employment of the obligor or obligee that meets the 
        criteria of paragraph (b), clause (2)(ii); 
           (2) the financial needs and resources, physical and 
        emotional condition, and educational needs of the child or 
        children to be supported; 
           (3) the standard of living the child would have enjoyed had 
        the marriage not been dissolved, but recognizing that the 
        parents now have separate households; 
           (4) which parent receives the income taxation dependency 
        exemption and what financial benefit the parent receives from 
        it; 
           (5) the parents' debts as provided in paragraph (d); and 
           (6) the obligor's receipt of public assistance under the 
        AFDC program formerly codified under sections 256.72 to 256.82 
        or 256B.01 to 256B.40 and chapter 256J or 256K.  
           (d) In establishing or modifying a support obligation, the 
        court may consider debts owed to private creditors, but only if: 
           (1) the right to support has not been assigned under 
        section 256.74 256.741; 
           (2) the court determines that the debt was reasonably 
        incurred for necessary support of the child or parent or for the 
        necessary generation of income.  If the debt was incurred for 
        the necessary generation of income, the court shall consider 
        only the amount of debt that is essential to the continuing 
        generation of income; and 
           (3) the party requesting a departure produces a sworn 
        schedule of the debts, with supporting documentation, showing 
        goods or services purchased, the recipient of them, the amount 
        of the original debt, the outstanding balance, the monthly 
        payment, and the number of months until the debt will be fully 
        paid. 
           (e) Any schedule prepared under paragraph (d), clause (3), 
        shall contain a statement that the debt will be fully paid after 
        the number of months shown in the schedule, barring emergencies 
        beyond the party's control.  
           (f) Any further departure below the guidelines that is 
        based on a consideration of debts owed to private creditors 
        shall not exceed 18 months in duration, after which the support 
        shall increase automatically to the level ordered by the court.  
        Nothing in this section shall be construed to prohibit one or 
        more step increases in support to reflect debt retirement during 
        the 18-month period.  
           (g) If payment of debt is ordered pursuant to this section, 
        the payment shall be ordered to be in the nature of child 
        support.  
           (h) Nothing shall preclude the court from receiving 
        evidence on the above factors to determine if the guidelines 
        should be exceeded or modified in a particular case.  
           (i) The guidelines in this subdivision are a rebuttable 
        presumption and shall be used in all cases when establishing or 
        modifying child support.  If the court does not deviate from the 
        guidelines, the court shall make written findings concerning the 
        amount of the obligor's income used as the basis for the 
        guidelines calculation and any other significant evidentiary 
        factors affecting the determination of child support.  If the 
        court deviates from the guidelines, the court shall make written 
        findings giving the amount of support calculated under the 
        guidelines, the reasons for the deviation, and shall 
        specifically address the criteria in paragraph (c) and how the 
        deviation serves the best interest of the child.  The court may 
        deviate from the guidelines if both parties agree and the court 
        makes written findings that it is in the best interests of the 
        child, except that in cases where child support payments are 
        assigned to the public agency under section 256.74 256.741, the 
        court may deviate downward only as provided in paragraph (j).  
        Nothing in this paragraph prohibits the court from deviating in 
        other cases.  The provisions of this paragraph apply whether or 
        not the parties are each represented by independent counsel and 
        have entered into a written agreement.  The court shall review 
        stipulations presented to it for conformity to the guidelines 
        and the court is not required to conduct a hearing, but the 
        parties shall provide the documentation of earnings required 
        under subdivision 5b. 
           (j) If the child support payments are assigned to the 
        public agency under section 256.74 256.741, the court may not 
        deviate downward from the child support guidelines unless the 
        court specifically finds that the failure to deviate downward 
        would impose an extreme hardship on the obligor. 
           (k) The dollar amount of the income limit for application 
        of the guidelines must be adjusted on July 1 of every 
        even-numbered year to reflect cost-of-living changes.  The 
        supreme court shall select the index for the adjustment from the 
        indices listed in section 518.641.  The state court 
        administrator shall make the changes in the dollar amount 
        required by this paragraph available to courts and the public on 
        or before April 30 of the year in which the amount is to change. 
           (l) In establishing or modifying child support, if a child 
        receives a child's insurance benefit under United States Code, 
        title 42, section 402, because the obligor is entitled to old 
        age or disability insurance benefits, the amount of support 
        ordered shall be offset by the amount of the child's benefit.  
        The court shall make findings regarding the obligor's income 
        from all sources, the child support amount calculated under this 
        section, the amount of the child's benefit, and the obligor's 
        child support obligation.  Any benefit received by the child in 
        a given month in excess of the child support obligation shall 
        not be treated as an arrearage payment or a future payment. 
           Sec. 137.  Minnesota Statutes 1998, section 518.57, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SATISFACTION OF CHILD SUPPORT OBLIGATION.] The 
        court may conclude that an obligor has satisfied a child support 
        obligation by providing a home, care, and support for the child 
        while the child is living with the obligor, if the court finds 
        that the child was integrated into the family of the obligor 
        with the consent of the obligee and child support payments were 
        not assigned to the public agency under section 256.74 or 
        256.741. 
           Sec. 138.  Minnesota Statutes 1998, section 518.614, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DUTIES OF PUBLIC AUTHORITY.] Within three 
        working days of receipt of sums released under subdivision 2, 
        the public authority shall remit to the obligee all amounts not 
        assigned under section 256.74 256.741 as current support or 
        maintenance.  The public authority shall also serve a copy of 
        the court's order and the provisions of section 518.6111 and 
        this section on the obligor's employer or other payor of funds 
        unless within 15 days after mailing of the notice of intent to 
        implement income withholding the obligor requests a hearing on 
        the issue of whether payment was in default as of the date of 
        the notice of default and serves notice of the request for 
        hearing on the public authority and the obligee.  The public 
        authority shall instruct the employer or payor of funds pursuant 
        to section 518.6111 as to the effective date on which the next 
        support or maintenance payment is due.  The withholding process 
        must begin on said date and shall reflect the total credits of 
        principal and interest amounts received from the escrow account. 
           Sec. 139.  Minnesota Statutes 1998, section 518.64, 
        subdivision 2, is amended to read: 
           Subd. 2.  [MODIFICATION.] (a) The terms of an order 
        respecting maintenance or support may be modified upon a showing 
        of one or more of the following:  (1) substantially increased or 
        decreased earnings of a party; (2) substantially increased or 
        decreased need of a party or the child or children that are the 
        subject of these proceedings; (3) receipt of assistance 
        under the AFDC program formerly codified under sections 256.72 
        to 256.87 or 256B.01 to 256B.40, or chapter 256J or 256K; (4) a 
        change in the cost of living for either party as measured by the 
        federal bureau of statistics, any of which makes the terms 
        unreasonable and unfair; (5) extraordinary medical expenses of 
        the child not provided for under section 518.171; or (6) the 
        addition of work-related or education-related child care 
        expenses of the obligee or a substantial increase or decrease in 
        existing work-related or education-related child care expenses.  
           On a motion to modify support, the needs of any child the 
        obligor has after the entry of the support order that is the 
        subject of a modification motion shall be considered as provided 
        by section 518.551, subdivision 5f. 
           (b) It is presumed that there has been a substantial change 
        in circumstances under paragraph (a) and the terms of a current 
        support order shall be rebuttably presumed to be unreasonable 
        and unfair if: 
           (1) the application of the child support guidelines in 
        section 518.551, subdivision 5, to the current circumstances of 
        the parties results in a calculated court order that is at least 
        20 percent and at least $50 per month higher or lower than the 
        current support order; 
           (2) the medical support provisions of the order established 
        under section 518.171 are not enforceable by the public 
        authority or the custodial parent; 
           (3) health coverage ordered under section 518.171 is not 
        available to the child for whom the order is established by the 
        parent ordered to provide; or 
           (4) the existing support obligation is in the form of a 
        statement of percentage and not a specific dollar amount.  
           (c) On a motion for modification of maintenance, including 
        a motion for the extension of the duration of a maintenance 
        award, the court shall apply, in addition to all other relevant 
        factors, the factors for an award of maintenance under section 
        518.552 that exist at the time of the motion.  On a motion for 
        modification of support, the court:  
           (1) shall apply section 518.551, subdivision 5, and shall 
        not consider the financial circumstances of each party's spouse, 
        if any; and 
           (2) shall not consider compensation received by a party for 
        employment in excess of a 40-hour work week, provided that the 
        party demonstrates, and the court finds, that: 
           (i) the excess employment began after entry of the existing 
        support order; 
           (ii) the excess employment is voluntary and not a condition 
        of employment; 
           (iii) the excess employment is in the nature of additional, 
        part-time employment, or overtime employment compensable by the 
        hour or fractions of an hour; 
           (iv) the party's compensation structure has not been 
        changed for the purpose of affecting a support or maintenance 
        obligation; 
           (v) in the case of an obligor, current child support 
        payments are at least equal to the guidelines amount based on 
        income not excluded under this clause; and 
           (vi) in the case of an obligor who is in arrears in child 
        support payments to the obligee, any net income from excess 
        employment must be used to pay the arrearages until the 
        arrearages are paid in full. 
           (d) A modification of support or maintenance may be made 
        retroactive only with respect to any period during which the 
        petitioning party has pending a motion for modification but only 
        from the date of service of notice of the motion on the 
        responding party and on the public authority if public 
        assistance is being furnished or the county attorney is the 
        attorney of record.  However, modification may be applied to an 
        earlier period if the court makes express findings that:  
           (1) the party seeking modification was precluded from 
        serving a motion by reason of a significant physical or mental 
        disability, a material misrepresentation of another party, or 
        fraud upon the court and that the party seeking modification, 
        when no longer precluded, promptly served a motion; 
           (2) the party seeking modification was a recipient of 
        federal Supplemental Security Income (SSI), Title II Older 
        Americans, Survivor's Disability Insurance (OASDI), other 
        disability benefits, or public assistance based upon need during 
        the period for which retroactive modification is sought; or 
           (3) the order for which the party seeks amendment was 
        entered by default, the party shows good cause for not 
        appearing, and the record contains no factual evidence, or 
        clearly erroneous evidence regarding the individual obligor's 
        ability to pay.  
           The court may provide that a reduction in the amount 
        allocated for child care expenses based on a substantial 
        decrease in the expenses is effective as of the date the 
        expenses decreased. 
           (e) Except for an award of the right of occupancy of the 
        homestead, provided in section 518.63, all divisions of real and 
        personal property provided by section 518.58 shall be final, and 
        may be revoked or modified only where the court finds the 
        existence of conditions that justify reopening a judgment under 
        the laws of this state, including motions under section 518.145, 
        subdivision 2.  The court may impose a lien or charge on the 
        divided property at any time while the property, or subsequently 
        acquired property, is owned by the parties or either of them, 
        for the payment of maintenance or support money, or may 
        sequester the property as is provided by section 518.24. 
           (f) The court need not hold an evidentiary hearing on a 
        motion for modification of maintenance or support. 
           (g) Section 518.14 shall govern the award of attorney fees 
        for motions brought under this subdivision. 
           Sec. 140.  Minnesota Statutes 1998, section 548.13, is 
        amended to read: 
           548.13 [ASSIGNMENT OF JUDGMENT; MODE AND EFFECT.] 
           Every assignment of a judgment shall be in writing, signed 
        and acknowledged by the assignor, except that written notice of 
        assignment shall be sufficient in the case of assignment under 
        section 256.74 256.741.  No assignment shall be valid as against 
        a subsequent purchaser of the judgment in good faith for value, 
        or against a creditor levying upon or attaching the same, unless 
        it is filed with the court administrator and an entry is made in 
        the docket.  When filed and entered, no one but the assignee, 
        the assignee's agent, or attorney, shall be authorized to 
        collect or enforce the judgment; provided, that the lien of an 
        attorney on the judgment shall not be affected by the assignment.
           Sec. 141.  Minnesota Statutes 1998, section 550.136, 
        subdivision 6, is amended to read: 
           Subd. 6.  [EARNINGS EXEMPTION NOTICE.] Before the first 
        levy on earnings under this chapter, the judgment creditor shall 
        serve upon the judgment debtor no less than ten days before the 
        service of the writ of execution, a notice that the writ of 
        execution may be served on the judgment debtor's employer.  The 
        notice must:  (1) be substantially in the form set forth below; 
        (2) be served personally, in the manner of a summons and 
        complaint, or by first class mail to the last known address of 
        the judgment debtor; (3) inform the judgment debtor that an 
        execution levy may be served on the judgment debtor's employer 
        in ten days, and that the judgment debtor may, within that time, 
        cause to be served on the judgment creditor a signed statement 
        under penalties of perjury asserting an entitlement to an 
        exemption from execution; (4) inform the judgment debtor of the 
        earnings exemptions contained in section 550.37, subdivision 14; 
        and (5) advise the judgment debtor of the relief set forth in 
        this chapter to which the debtor may be entitled if a judgment 
        creditor in bad faith disregards a valid claim and the fee, 
        costs, and penalty that may be assessed against a judgment 
        debtor who in bad faith falsely claims an exemption or in bad 
        faith takes action to frustrate the execution process.  The 
        notice requirement of this subdivision does not apply to a levy 
        on earnings being retained by an employer pursuant to a 
        garnishment previously served in compliance with chapter 571.  
           The ten-day notice informing a judgment debtor that a writ 
        of execution may be used to levy the earnings of an individual 
        must be substantially in the following form: 
        STATE OF MINNESOTA                             DISTRICT COURT
        COUNTY OF .............         ........... JUDICIAL DISTRICT
        .............(Judgment Creditor)
        against
                                              EXECUTION EXEMPTION 
        .............(Judgment Debtor)        NOTICE AND NOTICE OF 
        and                                   INTENT TO LEVY ON EARNINGS 
                                              WITHIN TEN DAYS
        .............(Third Party)
           PLEASE TAKE NOTICE that a levy may be served upon your 
        employer or other third parties, without any further court 
        proceedings or notice to you, ten days or more from the date 
        hereof.  Your earnings are completely exempt from execution levy 
        if you are now a recipient of relief based on need, if you have 
        been a recipient of relief within the last six months, or if you 
        have been an inmate of a correctional institution in the last 
        six months. 
           Relief based on need includes Aid to Families with 
        Dependent Children (AFDC), AFDC-Emergency Assistance (AFDC-EA) 
        Minnesota family investment program, Emergency Assistance (EA), 
        work first, Medical Assistance (MA), General Assistance (GA), 
        General Assistance Medical Care (GAMC), Emergency General 
        Assistance (EGA), Work Readiness, Minnesota Supplemental Aid 
        (MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security 
        Income (SSI), and Energy Assistance. 
           If you wish to claim an exemption, you should fill out the 
        appropriate form below, sign it, and send it to the judgment 
        creditor's attorney. 
           You may wish to contact the attorney for the judgment 
        creditor in order to arrange for a settlement of the debt or 
        contact an attorney to advise you about exemptions or other 
        rights. 
                                   PENALTIES
           (1) Be advised that even if you claim an exemption, an 
           execution levy may still be served on your employer.  If 
           your earnings are levied on after you claim an exemption, 
           you may petition the court for a determination of your 
           exemption.  If the court finds that the judgment creditor 
           disregarded your claim of exemption in bad faith, you will 
           be entitled to costs, reasonable attorney fees, actual 
           damages, and an amount not to exceed $100. 
           (2) HOWEVER, BE WARNED if you claim an exemption, the 
           judgment creditor can also petition the court for a 
           determination of your exemption, and if the court finds 
           that you claimed an exemption in bad faith, you will be 
           assessed costs and reasonable attorney's fees plus an 
           amount not to exceed $100. 
           (3) If after receipt of this notice, you in bad faith take 
           action to frustrate the execution levy, thus requiring the 
           judgment creditor to petition the court to resolve the 
           problem, you will be liable to the judgment creditor for 
           costs and reasonable attorney's fees plus an amount not to 
           exceed $100. 
        DATED:  ............           ........................
                                       (Attorney for Judgment Creditor)
                                       ........................
                                       Address
                                       ........................
                                       Telephone
                    JUDGMENT DEBTOR'S EXEMPTION CLAIM NOTICE
           I hereby claim that my earnings are exempt from execution 
        because: 
           (1) I am presently a recipient of relief based on need. 
           (Specify the program, case number, and the county from 
           which relief is being received.) 
        ................    ......................   ...............
        Program             Case Number (if known)   County
           (2) I am not now receiving relief based on need, but I have 
           received relief based on need within the last six months.  
           (Specify the program, case number, and the county from 
           which relief has been received.) 
        ................    ......................   ...............
        Program             Case Number (if known)   County
           (3) I have been an inmate of a correctional institution 
           within the last six months.  (Specify the correctional 
           institution and location.) 
        ...........................       ..........................
        Correctional Institution          Location
           I hereby authorize any agency that has distributed relief 
        to me or any correctional institution in which I was an inmate 
        to disclose to the above-named judgment creditor or the judgment 
        creditor's attorney only whether or not I am or have been a 
        recipient of relief based on need or an inmate of a correctional 
        institution within the last six months.  I have mailed or 
        delivered a copy of this form to the judgment creditor or 
        judgment creditor's attorney. 
        ...........................          .........................
                                             Debtor
                                             .........................
                                             Address
           Sec. 142.  Minnesota Statutes 1998, section 550.143, 
        subdivision 3, is amended to read: 
           Subd. 3.  [EXEMPTION NOTICE.] If the levy is on funds of a 
        judgment debtor who is a natural person and if the funds to be 
        levied are held on deposit at any financial institution, the 
        judgment creditor or its attorney shall provide the sheriff with 
        two copies of an exemption notice, which must be substantially 
        in the form set forth below.  The sheriff shall serve both 
        copies of the exemption notice on the financial institution, 
        along with the writ of execution.  Failure of the sheriff to 
        serve the exemption notices renders the levy void, and the 
        financial institution shall take no action.  However, if this 
        subdivision is being used to execute on funds that have 
        previously been garnished in compliance with section 571.71, the 
        judgment creditor is not required to serve additional exemption 
        notices.  In that event, the execution levy shall only be 
        effective as to the funds that were subject to the prior 
        garnishment.  Upon receipt of the writ of execution and 
        exemption notices, the financial institution shall retain as 
        much of the amount due under section 550.04 as the financial 
        institution has on deposit owing to the judgment debtor, but not 
        more than 110 percent of the amount remaining due on the 
        judgment.  
        STATE OF MINNESOTA                             DISTRICT COURT
        COUNTY OF ................       .......... JUDICIAL DISTRICT
        .............(Judgment Creditor) 
        .............(Judgment Debtor) 
        TO:  Debtor                                  EXEMPTION NOTICE 
           An order for attachment, garnishment summons, or levy of 
        execution (strike inapplicable language) has been served on 
        ............. (Bank or other financial institution where you 
        have an account.)  
           Your account balance is $........  
           The amount being held is $........  
           However, all or a portion of the funds in your account will 
        normally be exempt from creditors' claims if they are in one of 
        the following categories:  
           (1) relief based on need.  This includes:  Aid to Families 
        with Dependent Children (AFDC), AFDC-Emergency Assistance 
        (AFDC-EA) the Minnesota family investment program, Emergency 
        Assistance (EA), work first program, Medical Assistance (MA), 
        General Assistance (GA), General Assistance Medical Care (GAMC), 
        Emergency General Assistance (EGA), Work Readiness, Minnesota 
        Supplemental Aid (MSA), MSA Emergency Assistance (MSA-EA), 
        Supplemental Security Income (SSI), and Energy Assistance; 
           (2) Social Security benefits (Old Age, Survivors, or 
        Disability Insurance); 
           (3) reemployment insurance, workers' compensation, or 
        veterans' benefits; 
           (4) an accident, disability, or retirement pension or 
        annuity; 
           (5) life insurance proceeds; 
           (6) the earnings of your minor child and any child support 
        paid to you; or 
           (7) money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a mobile home, or a car).  
           The following funds are also exempt: 
           (8) all earnings of a person in category (1); 
           (9) all earnings of a person who has received relief based 
        on need, or who has been an inmate of a correctional 
        institution, within the last six months; 
           (10) 75 percent of every debtor's after tax earnings; and 
           (11) all of a judgment debtor's after tax earnings below 40 
        times the federal minimum wage. 
           TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:  
           Categories (10) and (11):  20 days 
           Categories (8) and (9):  60 days 
           All others:  no time limit, as long as funds are traceable 
        to the exempt source.  (In tracing funds, the first-in, 
        first-out method is used.  This means money deposited first is 
        spent first.)  The money being sought by the judgment creditor 
        is being held in your account to give you a chance to claim an 
        exemption. 
           TO CLAIM AN EXEMPTION:  
           Fill out, sign, and mail or deliver one copy of the 
        attached exemption claim form to the institution which sent you 
        this notice and mail or deliver one copy to the judgment 
        creditor's attorney.  In the event that there is no attorney for 
        the judgment creditor, then the notice shall be sent directly to 
        the judgment creditor.  The address for the judgment creditor's 
        attorney or the judgment creditor is set forth below.  Both 
        copies must be mailed or delivered on the same day. 
           If the financial institution does not get the exemption 
        claim back from you within 14 days of the date they mailed or 
        gave it to you, they will be free to turn the money over to the 
        sheriff or the judgment creditor.  If you are going to claim an 
        exemption, do so as soon as possible, because your money may be 
        held until it is decided. 
           IF YOU CLAIM AN EXEMPTION:  
           (1) nonexempt money can be turned over to the judgment 
        creditor or sheriff; 
           (2) the financial institution will keep holding the money 
        claimed to be exempt; and 
           (3) seven days after receiving your exemption claim, the 
        financial institution will release the money to you unless 
        before then it receives an objection to your exemption claim.  
           IF THE JUDGMENT CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM: 
           the institution will hold the money until a court decides 
        if your exemption claim is valid, BUT ONLY IF the institution 
        gets a copy of your court motion papers asserting the exemption 
        WITHIN TEN DAYS after the objection is mailed or given to you.  
        You may wish to consult an attorney at once if the creditor 
        objects to your exemption claim.  
           MOTION TO DETERMINE EXEMPTION:  
           At any time after your funds have been held, you may ask 
        for a court decision on the validity of your exemption claim by 
        filing a request for hearing which may be obtained at the office 
        of the court administrator of the above court. 
           PENALTIES:  
           If you claim an exemption in bad faith, or if the judgment 
        creditor wrongly objects to an exemption in bad faith, the court 
        may order the person who acted in bad faith to pay costs, actual 
        damages, attorney fees, and an additional amount of up to $100.  
                                      ............................. 
                                      ............................. 
                                      ............................. 
                                      ............................. 
                                      Name and address of (Attorney 
                                      for) Judgment Creditor
           EXEMPTION:  
           (a) Amount of exemption claim.  
           / / I claim ALL the funds being held are exempt.  
           / / I claim SOME of the funds being held are exempt.  
                 The exempt amount is $............  
           (b) Basis for exemption.  
           Of the 11 categories listed above, I am in category number 
        ............  (If more than one category applies, you may fill 
        in as many as apply.)  The source of the exempt funds is the 
        following:  
        .............................................................
        .............................................................
        .............................................................
           (If the source is a type of relief based on need, list the 
        case number and county:  
           case number:  ...............; 
           county:  ....................) 
           I hereby authorize any agency that has distributed relief 
        to me or any correctional institution in which I was an inmate 
        to disclose to the above named creditor or its attorney only 
        whether or not I am or have been a recipient of relief based on 
        need or an inmate of a correctional institute within the last 
        six months.  
           I have mailed or delivered a copy of the exemption notice 
        to the judgment creditor or judgment creditor's attorney if 
        represented. 
                                     .............................
                                     DEBTOR
        DATED:  .............        .............................
                                     .............................
                                     .............................
                                     DEBTOR ADDRESS 
           Sec. 143.  Minnesota Statutes 1998, section 550.37, 
        subdivision 14, is amended to read: 
           Subd. 14.  [PUBLIC ASSISTANCE.] All relief based on need, 
        and the earnings or salary of a person who is a recipient of 
        relief based on need, shall be exempt from all claims of 
        creditors including any contractual setoff or security interest 
        asserted by a financial institution.  For the purposes of this 
        chapter, relief based on need includes AFDC, MFIP, MFIP-R, 
        MFIP-S, work first, general assistance medical care, 
        supplemental security income, medical assistance, Minnesota 
        supplemental assistance, and general assistance.  The salary or 
        earnings of any debtor who is or has been an eligible recipient 
        of relief based on need, or an inmate of a correctional 
        institution shall, upon the debtor's return to private 
        employment or farming after having been an eligible recipient of 
        relief based on need, or an inmate of a correctional 
        institution, be exempt from attachment, garnishment, or levy of 
        execution for a period of six months after the debtor's return 
        to employment or farming and after all public assistance for 
        which eligibility existed has been terminated.  The exemption 
        provisions contained in this subdivision also apply for 60 days 
        after deposit in any financial institution, whether in a single 
        or joint account.  In tracing the funds, the first-in first-out 
        method of accounting shall be used.  The burden of establishing 
        that funds are exempt rests upon the debtor.  Agencies 
        distributing relief and the correctional institutions shall, at 
        the request of creditors, inform them whether or not any debtor 
        has been an eligible recipient of relief based on need, or an 
        inmate of a correctional institution, within the preceding six 
        months. 
           Sec. 144.  Minnesota Statutes 1998, section 551.05, 
        subdivision 1a, is amended to read: 
           Subd. 1a.  [EXEMPTION NOTICE.] If the writ of execution is 
        being used by the attorney to levy funds of a judgment debtor 
        who is a natural person and if the funds to be levied are held 
        on deposit at any financial institution, the attorney for the 
        judgment creditor shall serve with the writ of execution two 
        copies of an exemption notice.  The notice must be substantially 
        in the form set forth below.  Failure of the attorney for the 
        judgment creditor to send the exemption notice renders the 
        execution levy void, and the financial institution shall take no 
        action.  However, if this subdivision is being used to execute 
        on funds that have previously been garnished in compliance with 
        section 571.71, the attorney for judgment creditor is not 
        required to serve an additional exemption notice.  In that 
        event, the execution levy shall only be effective as to the 
        funds that were subject to the prior garnishment.  Upon receipt 
        of the writ of execution and exemption notices, the financial 
        institution shall retain as much of the amount due under section 
        550.04 as the financial institution has on deposit owing to the 
        judgment debtor, but not more than 100 percent of the amount 
        remaining due on the judgment, or $5,000, whichever is less.  
           The notice informing a judgment debtor that an execution 
        levy has been used to attach funds of the judgment debtor to 
        satisfy a claim must be substantially in the following form: 
           
        STATE OF MINNESOTA                             DISTRICT COURT 
        County of ................         .........JUDICIAL DISTRICT 
        ................(Judgment Creditor)
        ................(Judgment Debtor) 
        TO:  Judgment Debtor                 EXEMPTION NOTICE 
           An order for attachment, garnishment summons, or levy of 
        execution (strike inapplicable language) has been served on 
        ............. (bank or other financial institution where you 
        have an account).  
           Your account balance is $........  
           The amount being held is $........  
           However, all or a portion of the funds in your account will 
        normally be exempt from creditors' claims if they are in one of 
        the following categories:  
           (1) relief based on need.  This includes:  Aid to Families 
        with Dependent Children (AFDC), AFDC-Emergency Assistance 
        (AFDC-EA) the Minnesota family investment program (MFIP), work 
        first program, Medical Assistance (MA), General Assistance (GA), 
        General Assistance Medical Care (GAMC), Emergency General 
        Assistance (EGA), Work Readiness, Minnesota Supplemental Aid 
        (MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security 
        Income (SSI), and Energy Assistance; 
           (2) Social Security benefits (Old Age, Survivors, or 
        Disability Insurance); 
           (3) reemployment insurance, workers' compensation, or 
        veterans' benefits; 
           (4) an accident, disability, or retirement pension or 
        annuity; 
           (5) life insurance proceeds; 
           (6) the earnings of your minor child and any child support 
        paid to you; or 
           (7) money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a mobile home, or a car).  
           The following funds are also exempt: 
           (8) all earnings of a person in category (1); 
           (9) all earnings of a person who has received relief based 
        on need, or who has been an inmate of a correctional 
        institution, within the last six months; 
           (10) 75 percent of every judgment debtor's after tax 
        earnings; or 
           (11) all of a judgment debtor's after tax earnings below 40 
        times the federal minimum wage.  
           TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:  
           Categories (10) and (11):  20 days 
           Categories (8) and (9):  60 days 
           All others:  no time limit, as long as funds are traceable 
        to the exempt source.  (In tracing funds, the first-in, 
        first-out method is used.  This means money deposited first is 
        spent first.)  The money being sought by the judgment creditor 
        is being held in your account to give you a chance to claim an 
        exemption. 
           TO CLAIM AN EXEMPTION:  
           Fill out, sign, and mail or deliver one copy of the 
        attached exemption claim form to the institution which sent you 
        this notice and mail or deliver one copy to the judgment 
        creditor's attorney.  The address for the judgment creditor's 
        attorney is set forth below.  Both copies must be mailed or 
        delivered on the same day.  
           If they do not get the exemption claim back from you within 
        14 days of the date they mailed or gave it to you, they will be 
        free to turn the money over to the attorney for the judgment 
        creditor.  If you are going to claim an exemption, do so as soon 
        as possible, because your money may be held until it is decided. 
           IF YOU CLAIM AN EXEMPTION:  
           (1) nonexempt money can be turned over to the judgment 
        creditor or sheriff; 
           (2) the financial institution will keep holding the money 
        claimed to be exempt; and 
           (3) seven days after receiving your exemption claim, the 
        financial institution will release the money to you unless 
        before then it receives an objection to your exemption claim.  
           IF THE JUDGMENT CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM: 
           the institution will hold the money until a court decides 
        if your exemption claim is valid, BUT ONLY IF the institution 
        gets a copy of your court motion papers asserting the exemption 
        WITHIN TEN DAYS after the objection is mailed or given to you.  
        You may wish to consult an attorney at once if the judgment 
        creditor objects to your exemption claim.  
           MOTION TO DETERMINE EXEMPTION:  
           At any time after your funds have been held, you may ask 
        for a court decision on the validity of your exemption claim by 
        filing a request for hearing which may be obtained at the office 
        of the court administrator of the above court. 
           PENALTIES:  
           If you claim an exemption in bad faith, or if the judgment 
        creditor wrongly objects to an exemption in bad faith, the court 
        may order the person who acted in bad faith to pay costs, actual 
        damages, attorney fees, and an additional amount of up to $100.  
                                       ............................. 
                                       ............................. 
                                       ............................. 
                                       ............................. 
                                       Name and address of (Attorney 
                                       for) Judgment Creditor 
           EXEMPTION:  
           (a) Amount of exemption claim.  
           / / I claim ALL the funds being held are exempt.  
           / / I claim SOME of the funds being held are exempt.  
                 The exempt amount is $............  
           (b) Basis for exemption.  
           Of the 11 categories listed above, I am in category number 
        ............  (If more than one category applies, you may fill 
        in as many as apply.)  The source of the exempt funds is the 
        following:  
        .............................................................
        .............................................................
        .............................................................
           (If the source is a type of relief based on need, list the 
        case number and county:  
           case number:  ...............; 
           county:  ....................) 
           I hereby authorize any agency that has distributed relief 
        to me or any correctional institution in which I was an inmate 
        to disclose to the above named judgment creditor's attorney only 
        whether or not I am or have been a recipient of relief based on 
        need or an inmate of a correctional institute within the last 
        six months.  
           I have mailed or delivered a copy of the exemption notice 
        to the judgment creditor's attorney.  
                                     .............................
                                     DEBTOR
        DATED:  .............        .............................
                                     .............................
                                     .............................
                                     DEBTOR ADDRESS
           Sec. 145.  Minnesota Statutes 1998, section 551.06, 
        subdivision 6, is amended to read: 
           Subd. 6.  [EARNINGS EXEMPTION NOTICE.] Before the first 
        levy on earnings, the attorney for the judgment creditor shall 
        serve upon the judgment debtor no less than ten days before the 
        service of the writ of execution, a notice that the writ of 
        execution may be served on the judgment debtor's employer.  The 
        notice must:  (1) be substantially in the form set forth below; 
        (2) be served personally, in the manner of a summons and 
        complaint, or by first class mail to the last known address of 
        the judgment debtor; (3) inform the judgment debtor that an 
        execution levy may be served on the judgment debtor's employer 
        in ten days, and that the judgment debtor may, within that time, 
        cause to be served on the judgment creditor's attorney a signed 
        statement under penalties of perjury asserting an entitlement to 
        an exemption from execution; (4) inform the judgment debtor of 
        the earnings exemptions contained in section 550.37, subdivision 
        14; and (5) advise the judgment debtor of the relief set forth 
        in this chapter to which the judgment debtor may be entitled if 
        a judgment creditor in bad faith disregards a valid claim and 
        the fee, costs, and penalty that may be assessed against a 
        judgment debtor who in bad faith falsely claims an exemption or 
        in bad faith takes action to frustrate the execution process.  
        The notice requirement of this subdivision does not apply to a 
        levy on earnings being held by an employer pursuant to a 
        garnishment summons served in compliance with chapter 571.  
           The ten-day notice informing a judgment debtor that a writ 
        of execution may be used to levy the earnings of an individual 
        must be substantially in the following form: 
           
        STATE OF MINNESOTA                             DISTRICT COURT
        COUNTY OF .............         ........... JUDICIAL DISTRICT
        ............(Judgment Creditor)
        against
                                           EXECUTION EXEMPTION 
                                           NOTICE AND NOTICE OF 
        ............(Judgment Debtor)      INTENT TO LEVY ON EARNINGS 
        and                                WITHIN TEN DAYS 
        ............(Third Party)
           PLEASE TAKE NOTICE that a levy may be served upon your 
        employer or other third parties, without any further court 
        proceedings or notice to you, ten days or more from the date 
        hereof.  Your earnings are completely exempt from execution levy 
        if you are now a recipient of relief based on need, if you have 
        been a recipient of relief within the last six months, or if you 
        have been an inmate of a correctional institution in the last 
        six months. 
           Relief based on need includes Aid to Families with 
        Dependent Children (AFDC), AFDC-Emergency Assistance 
        (AFDC-EA) the Minnesota family investment program (MFIP), 
        Emergency Assistance (EA), work first program, Medical 
        Assistance (MA), General Assistance (GA), General Assistance 
        Medical Care (GAMC), Emergency General Assistance (EGA), Work 
        Readiness, Minnesota Supplemental Aid (MSA), MSA Emergency 
        Assistance (MSA-EA), Supplemental Security Income (SSI), and 
        Energy Assistance. 
           If you wish to claim an exemption, you should fill out the 
        appropriate form below, sign it, and send it to the judgment 
        creditor's attorney. 
           You may wish to contact the attorney for the judgment 
        creditor in order to arrange for a settlement of the debt or 
        contact an attorney to advise you about exemptions or other 
        rights. 
                                   PENALTIES
           (1) Be advised that even if you claim an exemption, an 
           execution levy may still be served on your employer.  If 
           your earnings are levied on after you claim an exemption, 
           you may petition the court for a determination of your 
           exemption.  If the court finds that the judgment creditor 
           disregarded your claim of exemption in bad faith, you will 
           be entitled to costs, reasonable attorney fees, actual 
           damages, and an amount not to exceed $100. 
           (2) HOWEVER, BE WARNED if you claim an exemption, the 
           judgment creditor can also petition the court for a 
           determination of your exemption, and if the court finds 
           that you claimed an exemption in bad faith, you will be 
           assessed costs and reasonable attorney's fees plus an 
           amount not to exceed $100. 
           (3) If after receipt of this notice, you in bad faith take 
           action to frustrate the execution levy, thus requiring the 
           judgment creditor to petition the court to resolve the 
           problem, you will be liable to the judgment creditor for 
           costs and reasonable attorney's fees plus an amount not to 
           exceed $100. 
        DATED:  ............           ........................
                                       (Attorney for Judgment Creditor)
                                       ........................
                                       Address
                                       ........................
                                       Telephone
                    JUDGMENT DEBTOR'S EXEMPTION CLAIM NOTICE
           I hereby claim that my earnings are exempt from execution 
        because: 
           (1) I am presently a recipient of relief based on need. 
           (Specify the program, case number, and the county from 
           which relief is being received.) 
        ................    ......................   ...............
        Program             Case Number (if known)   County
           (2) I am not now receiving relief based on need, but I have 
           received relief based on need within the last six months.  
           (Specify the program, case number, and the county from 
           which relief has been received.) 
        ................    ......................   ...............
        Program             Case Number (if known)   County
           (3) I have been an inmate of a correctional institution 
           within the last six months.  (Specify the correctional 
           institution and location.) 
        ...........................       ..........................
        Correctional Institution          Location
           I hereby authorize any agency that has distributed relief 
        to me or any correctional institution in which I was an inmate 
        to disclose to the above-named judgment creditor or the judgment 
        creditor's attorney only whether or not I am or have been a 
        recipient of relief based on need or an inmate of a correctional 
        institution within the last six months.  I have mailed or 
        delivered a copy of this form to the creditor or creditor's 
        attorney. 
        DATE: .....................          .........................
                                             Judgment Debtor
                                             .........................
                                             Address
           Sec. 146.  Minnesota Statutes 1998, section 570.025, 
        subdivision 6, is amended to read: 
           Subd. 6.  [NOTICE.] The respondent shall be served with a 
        copy of the preliminary attachment order issued pursuant to this 
        section together with a copy of all pleadings and other 
        documents not previously served, including any affidavits upon 
        which the claimant intends to rely at the subsequent hearing and 
        a transcript of any oral testimony given at the preliminary 
        hearing upon which the claimant intends to rely and a notice of 
        hearing.  Service shall be in the manner prescribed for personal 
        service of a summons unless that service is impracticable or 
        would be ineffective and the court prescribes an alternative 
        method of service calculated to provide actual notice to the 
        respondent. 
           The notice of hearing served upon the respondent shall be 
        signed by claimant or the attorney for claimant and shall 
        provide, at a minimum, the following information in 
        substantially the following language: 
                               NOTICE OF HEARING 
           To:  (the respondent) 
           The (insert name of court) Court has ordered the sheriff to 
        seize some of your property.  The court has directed the sheriff 
        to seize the following specific property:  (insert list of 
        property).  (List other action taken by the court).  Some of 
        your property may be exempt from seizure.  See the exemption 
        notice below. 
           The Court issued this Order based upon the claim of (insert 
        name of claimant) that (insert name of claimant) is entitled to 
        a court order for seizure of your property to secure your 
        payment of any money judgment that (insert name of claimant) may 
        later be obtained against you and that immediate action was 
        necessary. 
           You have the legal right to challenge (insert name of 
        claimant) claims at a court hearing before a judge.  The hearing 
        will be held at the (insert place) on (insert date) at (insert 
        time).  You may attend the court hearing alone or with an 
        attorney.  After you have presented your side of the matter, the 
        court will decide what should be done with your property until 
        the lawsuit against you is finally decided.  
           IF YOU DO NOT ATTEND THIS HEARING, THE COURT MAY ORDER THE 
        SHERIFF TO KEEP PROPERTY THAT HAS BEEN SEIZED. 
                                EXEMPTION NOTICE 
           An order of attachment is being served upon you.  Some of 
        your property is exempt and cannot be seized.  The following is 
        a list of some of the more common exemptions.  It is not 
        complete and is subject to section 550.37, and other state and 
        federal laws.  If you have questions about an exemption, you 
        should obtain competent legal advice. 
           1.  A homestead or the proceeds from the sale of a 
        homestead. 
           2.  Household furniture, appliances, phonographs, radios, 
        and televisions up to a total current value of $4,500 at the 
        time of attachment. 
           3.  A manufactured (mobile) home used as your home. 
           4.  One motor vehicle currently worth less than $2,000 
        after deducting any security interests. 
           5.  Farm machinery used by someone principally engaged in 
        farming, or tools, machines, or office furniture used in your 
        business or trade.  This exemption is limited to $5,000. 
           6.  Relief based on need.  This includes Aid to Families 
        with Dependent Children (AFDC) Minnesota family investment 
        program, Emergency Assistance (EA), work first program, 
        Supplemental Security Income (SSI), Minnesota Supplemental 
        Assistance, and General Assistance. 
           7.  Social Security benefits. 
           8.  Reemployment insurance, workers' compensation, or 
        veterans' benefits. 
           9.  An accident disability or retirement pension or annuity.
           10.  Life insurance proceeds or the earnings of your minor 
        child and any child support paid to you. 
           11.  Money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a manufactured (mobile) home, or a car). 
           Sec. 147.  Minnesota Statutes 1998, section 570.026, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SERVICE.] The claimant's motion to obtain an 
        order of attachment together with the claimant's affidavit and 
        notice of hearing shall be served in the manner prescribed for 
        service of a summons in a civil action in district court unless 
        that service is impracticable or would be ineffective and the 
        court prescribes an alternative method of service calculated to 
        provide actual notice to the respondent.  If the respondent has 
        already appeared in the action, the motion shall be served in 
        the manner prescribed for service of pleadings subsequent to the 
        summons.  The date of hearing shall be fixed in accordance with 
        Rule 6 of the Minnesota Rules of Civil Procedure, unless a 
        different date is fixed by order of the court. 
           The notice of hearing served upon the respondent shall be 
        signed by the claimant or the attorney for the claimant and 
        shall provide, at a minimum, the following information in 
        substantially the following language:  
                               NOTICE OF HEARING 
           TO:  (the respondent) 
           A hearing will be held (insert place) on (insert date) at 
        (insert time) to determine whether the sheriff shall seize 
        nonexempt property belonging to you to secure a judgment that 
        may be entered against you. 
           You may attend the court hearing alone or with an 
        attorney.  After you have presented your side of the matter, the 
        court will decide what should be done with your property until 
        the lawsuit which has been commenced against you is finally 
        decided. 
           If the court directs the sheriff to seize and secure the 
        property while the lawsuit is pending, you may still keep the 
        property until the lawsuit is decided if you file a bond in an 
        amount set by the court. 
           IF YOU DO NOT ATTEND THIS HEARING, THE COURT MAY ORDER YOUR 
        NONEXEMPT PROPERTY TO BE SEIZED. 
                                EXEMPTION NOTICE 
           Some of your property is exempt and cannot be attached.  
        The following is a list of some of the more common exemptions.  
        It is not complete and is subject to section 550.37, and other 
        state and federal laws.  If you have questions about an 
        exemption you should obtain competent legal advice. 
           1.  A homestead or the proceeds from the sale of a 
        homestead. 
           2.  Household furniture, appliances, phonographs, radios, 
        and televisions up to a total current value of $4,500 at the 
        time of attachment. 
           3.  A manufactured (mobile) home used as your home. 
           4.  One motor vehicle currently worth less than $2,000 
        after deducting any security interests. 
           5.  Farm machinery used by someone principally engaged in 
        farming, or tools, machines, or office furniture used in your 
        business or trade.  This exemption is limited to $5,000. 
           6.  Relief based on need.  This includes Aid to Families 
        with Dependent Children (AFDC) Minnesota family investment 
        program, Emergency Assistance (EA), work first program, 
        Supplemental Security Income (SSI), Minnesota Supplemental 
        Assistance, and General Assistance. 
           7.  Social Security benefits. 
           8.  Reemployment insurance, workers' compensation, or 
        veterans' benefits. 
           9.  An accident disability or retirement pension or annuity.
           10.  Life insurance proceeds or the earnings of your minor 
        child and any child support paid to you. 
           11.  Money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a manufactured (mobile) home, or a car). 
           Sec. 148.  Minnesota Statutes 1998, section 571.72, 
        subdivision 8, is amended to read: 
           Subd. 8.  [EXEMPTION NOTICE.] In every garnishment where 
        the debtor is a natural person, the debtor shall be provided 
        with a garnishment exemption notice.  If the creditor is 
        garnishing earnings, the earnings exemption notice provided in 
        section 571.924 must be served ten or more days before the 
        service of the first garnishment summons.  If the creditor is 
        garnishing funds in a financial institution, the exemption 
        notice provided in section 571.912 must be served with the 
        garnishment summons.  In all other cases, the exemption notice 
        must be in the following form and served on the debtor with a 
        copy of the garnishment summons. 
           
        STATE OF MINNESOTA                             DISTRICT COURT
        COUNTY OF ..................    ............JUDICIAL DISTRICT
        .................(Creditor)
        against
        .................(Debtor)                    EXEMPTION NOTICE
        and
        .................(Garnishee)
           A Garnishment Summons is being served upon you.  Some of 
        your property may be exempt and cannot be garnished.  The 
        following is a list of some of the more common exemptions.  It 
        is not complete and is subject to section 550.37 of the 
        Minnesota Statutes and other state and federal laws.  The dollar 
        amounts contained in this list are subject to the provisions of 
        section 550.37, subdivision 4a, at the time of garnishment.  If 
        you have questions about an exemption, you should obtain legal 
        advice. 
           (1) a homestead or the proceeds from the sale of a 
        homestead; 
           (2) household furniture, appliances, phonographs, radios, 
        and televisions up to a total current value of $5,850; 
           (3) a manufactured (mobile) home used as your home; 
           (4) one motor vehicle currently worth less than $2,600 
        after deducting any security interest; 
           (5) farm machinery used by an individual principally 
        engaged in farming, or tools, machines, or office furniture used 
        in your business or trade.  This exemption is limited to 
        $13,000; 
           (6) relief based on need.  This includes: 
           (i) Aid to Families with Dependent Children 
        (AFDC) Minnesota family investment program (MFIP) and work first 
        program; 
           (ii) AFDC-Emergency Assistance (AFDC-EA); 
           (iii) Medical Assistance (MA); 
           (iv) (iii) General Assistance (GA); 
           (v) (iv) General Assistance Medical Care (GAMC); 
           (vi) (v) Emergency General Assistance (EGA); 
           (vii) (vi) Work Readiness, Minnesota Supplemental AID 
        (MSA); 
           (viii) (vii) MSA-Emergency Assistance (MSA-EA); 
           (ix) (viii) Supplemental Security Income (SSI); and 
           (x) (ix) Energy Assistance; and 
           (x) Emergency Assistance (EA); 
           (7) social security benefits; 
           (8) reemployment insurance, workers' compensation, or 
        veteran's benefits; 
           (9) an accident, disability, or retirement pension or 
        annuity; 
           (10) life insurance proceeds; 
           (11) earnings of your minor child; and 
           (12) money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a manufactured (mobile) home, or a car). 
           Sec. 149.  Minnesota Statutes 1998, section 571.912, is 
        amended to read: 
           571.912 [FORM OF EXEMPTION NOTICE.] 
           The notice informing a debtor that an order for attachment, 
        garnishment summons, or levy by execution has been used to 
        attach funds of the debtor to satisfy a claim must be 
        substantially in the following form:  
        STATE OF MINNESOTA                            DISTRICT COURT 
        COUNTY OF ................         ........JUDICIAL DISTRICT
        ........................(Creditor)
        ........................(Debtor)
        TO:  Debtor                                EXEMPTION NOTICE
           An order for attachment, garnishment summons, or levy of 
        execution (strike inapplicable language) has been served on 
        ............ (bank or other financial institution) 
        ............... where you have an account.  
           Your account balance is $.............  
           The amount being held is $............  
           However, all or a portion of the funds in your account will 
        normally be exempt from creditors' claims if they are in one of 
        the following categories: 
           (1) relief based on need.  This includes:  Aid to Families 
        with Dependent Children (AFDC), AFDC-Emergency Assistance 
        (AFDC-EA) the Minnesota family investment program (MFIP), 
        Emergency Assistance (EA), work first program, Medical 
        Assistance (MA), General Assistance (GA), General Assistance 
        Medical Care (GAMC), Emergency General Assistance (EGA), Work 
        Readiness, Minnesota Supplemental Aid (MSA), MSA Emergency 
        Assistance (MSA-EA), Supplemental Security Income (SSI), and 
        Energy Assistance; 
           (2) Social Security benefits (Old Age, Survivors, or 
        Disability Insurance); 
           (3) reemployment insurance, workers' compensation, or 
        veterans' benefits; 
           (4) an accident, disability, or retirement pension or 
        annuity; 
           (5) life insurance proceeds; 
           (6) the earnings of your minor child and any child support 
        paid to you; or 
           (7) money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a mobile home, or a car).  
           The following funds are also exempt: 
           (8) all earnings of a person in category (1); 
           (9) all earnings of a person who has received relief based 
        on need, or who has been an inmate of a correctional 
        institution, within the last six months; 
           (10) 75 percent of every debtor's after tax earnings; and 
           (11) all of a debtor's after tax earnings below 40 times 
        the federal minimum wage. 
           TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:  
           Categories (10) and (11):  20 days 
           Categories (8) and (9):  60 days 
           All others:  no time limit, as long as funds are traceable 
        to the exempt source.  (In tracing funds, the first-in, 
        first-out method is used.  This means money deposited first is 
        spent first.)  The money being sought by the creditor is being 
        held in your account to give you a chance to claim an exemption. 
           TO CLAIM AN EXEMPTION:  
           Fill out, sign, and mail or deliver one copy of the 
        attached exemption claim form to the institution which sent you 
        this notice and mail or deliver one copy to the creditor's 
        attorney.  In the event that there is no attorney for the 
        creditor, then such notice shall be sent directly to the 
        creditor.  The address for the creditor's attorney or the 
        creditor is set forth below.  Both copies must be mailed or 
        delivered on the same day.  
           If they do not get the exemption claim back from you within 
        14 days of the date they mailed or gave it to you, they will be 
        free to turn the money over to the sheriff or the creditor.  If 
        you are going to claim an exemption, do so as soon as possible, 
        because your money may be held until it is decided. 
           IF YOU CLAIM AN EXEMPTION:  
           (1) nonexempt money can be turned over to the creditor or 
        sheriff; 
           (2) the financial institution will keep holding the money 
        claimed to be exempt; and 
           (3) seven days after receiving your exemption claim, the 
        financial institution will release the money to you unless 
        before then it receives an objection to your exemption claim.  
           IF THE CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM: 
           The institution will hold the money until a court decides 
        if your exemption claim is valid, BUT ONLY IF the institution 
        gets a copy of your court motion papers asserting the exemption 
        WITHIN TEN DAYS after the objection is mailed or given to you.  
        You may wish to consult an attorney at once if the creditor 
        objects to your exemption claim.  
           MOTION TO DETERMINE EXEMPTION:  
           At any time after your funds have been held, you may ask 
        for a court decision on the validity of your exemption claim by 
        filing a request for hearing which may be obtained at the office 
        of the court administrator of the above court. 
           PENALTIES:  
           If you claim an exemption in bad faith, or if the creditor 
        wrongly objects to an exemption in bad faith, the court may 
        order the person who acted in bad faith to pay costs, actual 
        damages, attorney fees, and an additional amount of up to $100.  
                                      .............................
                                      .............................
                                      ............................. 
                                      ............................. 
                                      Name and address of (Attorney
                                      for) Judgment Creditor
           EXEMPTION:  
           (If you claim an exemption complete the following): 
           (a) Amount of exemption claim.  
           / / I claim ALL the funds being held are exempt.  
           / / I claim SOME of the funds being held are exempt.  
                 The exempt amount is $............  
           (b) Basis for exemption.  
           Of the eleven categories listed above, I am in category 
        number ............  (If more than one category applies, you may 
        fill in as many as apply.)  The source of the exempt funds is 
        the following:  
        .............................................................
        .............................................................
        .............................................................
           (If the source is a type of relief based on need, list the 
        case number and county:  
           case number:  ...............; 
           county:  ....................) 
           I hereby authorize any agency that has distributed relief 
        to me or any correctional institution in which I was an inmate 
        to disclose to the above named creditor or its attorney only 
        whether or not I am or have been a recipient of relief based on 
        need or an inmate of a correctional institute within the last 
        six months.  
           I have mailed or delivered a copy of the exemption notice 
        to the creditor's attorney.  
        DATED:  .............        .............................
                                     DEBTOR 
                                     .............................
                                     DEBTOR ADDRESS
           Sec. 150.  Minnesota Statutes 1998, section 571.925, is 
        amended to read: 
           571.925 [FORM OF NOTICE.] 
           The ten-day notice informing a debtor that a garnishment 
        summons may be used to garnish the earnings of an individual 
        must be substantially in the following form: 
        STATE OF MINNESOTA                             DISTRICT COURT
        COUNTY OF .............         ........... JUDICIAL DISTRICT
        ....................(Creditor)
        against
                                           GARNISHMENT EXEMPTION 
        ....................(Debtor)       NOTICE AND NOTICE OF 
        and                                INTENT TO GARNISH EARNINGS 
                                           WITHIN TEN DAYS
        ....................(Garnishee)
           PLEASE TAKE NOTICE that a garnishment summons or levy may 
        be served upon your employer or other third parties, without any 
        further court proceedings or notice to you, ten days or more 
        from the date hereof.  Some or all of your earnings are exempt 
        from garnishment.  If your earnings are garnished, your employer 
        must show you how the amount that is garnished from your 
        earnings was calculated.  You have the right to request a 
        hearing if you claim the garnishment is incorrect. 
           Your earnings are completely exempt from garnishment if you 
        are now a recipient of relief based on need, if you have been a 
        recipient of relief within the last six months, or if you have 
        been an inmate of a correctional institution in the last six 
        months. 
           Relief based on need includes Aid to Families with 
        Dependent Children (AFDC), AFDC-Emergency Assistance (AFDC-EA) 
        the Minnesota family investment program (MFIP), Emergency 
        Assistance (EA), work first program, Medical Assistance (MA), 
        General Assistance (GA), General Assistance Medical Care (GAMC), 
        Emergency General Assistance (EGA), Work Readiness, Minnesota 
        Supplemental Aid (MSA), MSA Emergency Assistance (MSA-EA), 
        Supplemental Security Income (SSI), and Energy Assistance. 
           If you wish to claim an exemption, you should fill out the 
        appropriate form below, sign it, and send it to the creditor's 
        attorney and the garnishee. 
           You may wish to contact the attorney for the creditor in 
        order to arrange for a settlement of the debt or contact an 
        attorney to advise you about exemptions or other rights. 
                                   PENALTIES
           (1) Be advised that even if you claim an exemption, a 
           garnishment summons may still be served on your employer.  
           If your earnings are garnished after you claim an 
           exemption, you may petition the court for a determination 
           of your exemption.  If the court finds that the creditor 
           disregarded your claim of exemption in bad faith, you will 
           be entitled to costs, reasonable attorney fees, actual 
           damages, and an amount not to exceed $100. 
           (2) HOWEVER, BE WARNED if you claim an exemption, the 
           creditor can also petition the court for a determination of 
           your exemption, and if the court finds that you claimed an 
           exemption in bad faith, you will be assessed costs and 
           reasonable attorney's fees plus an amount not to exceed 
           $100. 
           (3) If after receipt of this notice, you in bad faith take 
           action to frustrate the garnishment, thus requiring the 
           creditor to petition the court to resolve the problem, you 
           will be liable to the creditor for costs and reasonable 
           attorney's fees plus an amount not to exceed $100. 
        DATED:  ............           ........................
                                       (Attorney for) Creditor
                                       ........................
                                       Address
                                       ........................
                                       Telephone
                        DEBTOR'S EXEMPTION CLAIM NOTICE
           I hereby claim that my earnings are exempt from garnishment 
        because: 
           (1) I am presently a recipient of relief based on need. 
           (Specify the program, case number, and the county from 
           which relief is being received.) 
        ................    ......................   ...............
        Program             Case Number (if known)   County
           (2) I am not now receiving relief based on need, but I have 
           received relief based on need within the last six months.  
           (Specify the program, case number, and the county from 
           which relief has been received.) 
        ................    ......................   ...............
        Program             Case Number (if known)   County
           (3) I have been an inmate of a correctional institution 
           within the last six months.  (Specify the correctional 
           institution and location.) 
        ...........................       ..........................
        Correctional Institution          Location
           I hereby authorize any agency that has distributed relief 
        to me or any correctional institution in which I was an inmate 
        to disclose to the above-named creditor or the creditor's 
        attorney only whether or not I am or have been a recipient of 
        relief based on need or an inmate of a correctional institution 
        within the last six months.  I have mailed or delivered a copy 
        of this form to the creditor or creditor's attorney. 
        ...........................          .........................
        Date                                 Debtor
                                             .........................
                                             Address
           Sec. 151.  Minnesota Statutes 1998, section 571.931, 
        subdivision 6, is amended to read: 
           Subd. 6.  [NOTICE.] The debtor shall be served with a copy 
        of the prejudgment garnishment order issued pursuant to this 
        section together with a copy of all pleadings and other 
        documents not previously served, including any affidavits upon 
        which the claimant intends to rely at the subsequent hearing and 
        a transcript of any oral testimony given at the prejudgment 
        garnishment hearing upon which the creditor intends to rely and 
        a notice of hearing.  Service must be in the manner prescribed 
        for personal service of a summons unless that service is 
        impracticable or would be ineffective and the court prescribes 
        an alternative method of service calculated to provide actual 
        notice to the debtor. 
           The notice of hearing served upon the debtor must be signed 
        by the creditor or the attorney for the creditor and must be 
        accompanied by an exemption notice.  The notice of hearing must 
        be accompanied by an exemption notice, and both notices must 
        provide, at a minimum, the following information in 
        substantially the following language: 
                               NOTICE OF HEARING
           TO:  (the debtor) 
           The (insert the name of court) Court has ordered the 
        prejudgment garnishment of some of your property in the 
        possession or control of a third party.  Some of your property 
        may be exempt from seizure.  See the exemption notice below.  
           The Court issued this Order based upon the claim of (insert 
        name of creditor) that (insert name of creditor) is entitled to 
        a court order for garnishment of your property to secure your 
        payment of any money judgment that (insert name of creditor) may 
        later be obtained against you and that immediate action was 
        necessary.  
           You have the legal right to challenge (insert name of 
        creditor) claims at a court hearing before a judge.  The hearing 
        will be held at the (insert place) on (insert date) at (insert 
        time).  You may attend the court hearing alone or with an 
        attorney.  After you have presented your side of the matter, the 
        court will decide what should be done with your property until 
        the lawsuit against you is finally decided.  
           IF YOU DO NOT ATTEND THIS HEARING, THE COURT MAY ORDER 
        GARNISHMENT OF YOUR PROPERTY. 
                                EXEMPTION NOTICE
           Some of your property may be exempt and cannot be garnished.
        The following is a list of some of the more common exemptions.  
        It is not complete and is subject to section 550.37, and other 
        state and federal laws.  If you have questions about an 
        exemption, you should obtain competent legal advice.  
           (1) A homestead or the proceeds from the sale of a 
        homestead.  
           (2) Household furniture, appliances, phonographs, radios, 
        and televisions up to a total current value of $4,500 at the 
        time of attachment.  
           (3) A manufactured (mobile) home used as your home.  
           (4) One motor vehicle currently worth less than $2,000 
        after deducting any security interests.  
           (5) Farm machinery used by someone principally engaged in 
        farming, or tools, machines, or office furniture used in your 
        business or trade.  This exemption is limited to $10,000.  
           (6) Relief based on need.  This includes:  Aid to Families 
        with Dependent Children (AFDC), AFDC-Emergency Assistance 
        (AFDC-EA) the Minnesota family investment program (MFIP), 
        Emergency Assistance (EA), work first program, Medical 
        Assistance (MA), General Assistance (GA), General Assistance 
        Medical Care (GAMC), Emergency General Assistance (EGA), Work 
        Readiness, Minnesota Supplemental Aid (MSA), MSA Emergency 
        Assistance (MSA-EA), Supplemental Security Income (SSI), and 
        Energy Assistance.  
           (7) Social Security benefits.  
           (8) Reemployment insurance, workers' compensation, or 
        veterans' benefits.  
           (9) An accident, disability or retirement pension or 
        annuity. 
           (10) Life insurance proceeds.  
           (11) The earnings of your minor child.  
           (12) Money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a manufactured (mobile) home, or a car).  
           Sec. 152.  Minnesota Statutes 1998, section 571.932, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SERVICE.] The creditor's motion to obtain an 
        order of garnishment together with the creditor's affidavit and 
        notice of hearing must be served in the manner prescribed for 
        service of a summons in a civil action in district court unless 
        that service is impracticable or would be ineffective and the 
        court prescribes an alternative method of service calculated to 
        provide actual notice to the debtor.  If the debtor has already 
        appeared in the action, the motion must be served in the manner 
        prescribed for service of pleadings subsequent to the summons.  
        The date of the hearing must be fixed in accordance with Rule 6 
        of the Minnesota Rules of Civil Procedure for the District 
        Courts, unless a different date is fixed by order of the court.  
           The notice of hearing served upon the debtor shall be 
        signed by the creditor or the attorney for the creditor and 
        shall provide, at a minimum, the following information in 
        substantially the following language: 
                               NOTICE OF HEARING
           TO:  (the debtor) 
           A hearing will be held (insert place) on (insert date) at 
        (insert time) to determine whether nonexempt property belonging 
        to you will be garnished to secure a judgment that may be 
        entered against you.  
           You may attend the court hearing alone or with an attorney. 
        After you have presented your side of the matter, the court will 
        decide whether your property should be garnished until the 
        lawsuit which has been commenced against you is finally decided. 
           If the court directs the issuance of a garnishment summons 
        while the lawsuit is pending, you may still keep the property 
        until the lawsuit is decided if you file a bond in an amount set 
        by the court.  
           IF YOU DO NOT ATTEND THIS HEARING, THE COURT MAY ORDER YOUR 
        NONEXEMPT PROPERTY TO BE GARNISHED.  
                                EXEMPTION NOTICE
           Some of your property may be exempt and cannot be garnished.
        The following is a list of some of the more common exemptions.  
        It is not complete and is subject to section 550.37, and other 
        state and federal laws.  The dollar amounts contained in this 
        list are subject to the provisions of section 550.37, 
        subdivision 4a, at the time of the garnishment.  If you have 
        questions about an exemption, you should obtain competent legal 
        advice.  
           (1) A homestead or the proceeds from the sale of a 
        homestead.  
           (2) Household furniture, appliances, phonographs, radios, 
        and televisions up to a total current value of $5,850. 
           (3) A manufactured (mobile) home used as your home.  
           (4) One motor vehicle currently worth less than $2,600 
        after deducting any security interests.  
           (5) Farm machinery used by an individual principally 
        engaged in farming, or tools, machines, or office furniture used 
        in your business or trade.  This exemption is limited to $13,000.
           (6) Relief based on need.  This includes:  Aid to Families 
        with Dependent Children (AFDC), AFDC-Emergency Assistance 
        (AFDC-EA) the Minnesota family investment program (MFIP), 
        Emergency Assistance (EA), work first program, Medical 
        Assistance (MA), General Assistance (GA), General Assistance 
        Medical Care (GAMC), Emergency General Assistance (EGA), Work 
        Readiness, Minnesota Supplemental Aid (MSA), MSA Emergency 
        Assistance (MSA-EA), Supplemental Security Income (SSI), and 
        Energy Assistance.  
           (7) Social Security benefits.  
           (8) Reemployment insurance, workers' compensation, or 
        veterans' benefits.  
           (9) An accident, disability or retirement pension or 
        annuity. 
           (10) Life insurance proceeds.  
           (11) The earnings of your minor child.  
           (12) Money from a claim for damage or destruction of exempt 
        property (such as household goods, farm tools, business 
        equipment, a manufactured (mobile) home, or a car).  
           Sec. 153.  Minnesota Statutes 1998, section 583.22, 
        subdivision 7b, is amended to read: 
           Subd. 7b.  [NECESSARY LIVING EXPENSES.] As used in section 
        583.27, "necessary living expenses" means a sum approximately 
        equal to 1-1/2 times the amount to which the family would be 
        entitled if eligible for payments under section 256.74 chapter 
        256J, unless limited by section 583.27, subdivision 1, paragraph 
        (b). 
           Sec. 154.  [REPEALER.] 
           (a) Minnesota Statutes 1998, sections 119B.01, subdivision 
        12a; 119B.05, subdivision 6; 126C.05, subdivision 4; 126C.06; 
        256.031, subdivision 1a; 256.736; 256.74, subdivision 1c; 
        256.9850; 256J.62, subdivision 5; 268.871, subdivision 5; and 
        290A.22, are repealed. 
           (b) Minnesota Rules, parts 9500.2000; 9500.2020; 9500.2060; 
        9500.2100; 9500.2140; 9500.2180; 9500.2220; 9500.2260; 
        9500.2300; 9500.2340; 9500.2380; 9500.2420; 9500.2440; 
        9500.2480; 9500.2500; 9500.2520; 9500.2560; 9500.2580; 
        9500.2600; 9500.2620; 9500.2640; 9500.2680; 9500.2700; 
        9500.2720; 9500.2722; 9500.2724; 9500.2726; 9500.2728; 
        9500.2730; 9500.2740; 9500.2760; 9500.2780; 9500.2800; 
        9500.2820; 9500.2860; and 9500.2880, are repealed. 
           Presented to the governor May 11, 1999 
           Signed by the governor May 13, 1999, 1:27 p.m.

700 State Office Building, 100 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155 ♦ Phone: (651) 296-2868 ♦ TTY: 1-800-627-3529 ♦ Fax: (651) 296-0569