Minnesota Session Laws - 2003, 1st Special Session

                             CHAPTER 10-S.F.No. 27 
                  An act relating to municipalities; extending the 
                  maximum length of guaranteed energy savings contracts 
                  from ten to 15 years; amending Minnesota Statutes 
                  2002, section 471.345, subdivision 13. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 2002, section 471.345, 
        subdivision 13, is amended to read: 
           Subd. 13.  [ENERGY EFFICIENCY PROJECTS.] The following 
        definitions apply to this subdivision. 
           (a) "Energy conservation measure" means a training program 
        or facility alteration designed to reduce energy consumption or 
        operating costs and includes: 
           (1) insulation of the building structure and systems within 
        the building; 
           (2) storm windows and doors, caulking or weatherstripping, 
        multiglazed windows and doors, heat absorbing or heat reflective 
        glazed and coated window and door systems, additional glazing, 
        reductions in glass area, and other window and door system 
        modifications that reduce energy consumption; 
           (3) automatic energy control systems; 
           (4) heating, ventilating, or air conditioning system 
        modifications or replacements; 
           (5) replacement or modifications of lighting fixtures to 
        increase the energy efficiency of the lighting system without 
        increasing the overall illumination of a facility, unless an 
        increase in illumination is necessary to conform to the 
        applicable state or local building code for the lighting system 
        after the proposed modifications are made; 
           (6) energy recovery systems; 
           (7) cogeneration systems that produce steam or forms of 
        energy such as heat, as well as electricity, for use primarily 
        within a building or complex of buildings; 
           (8) energy conservation measures that provide long-term 
        operating cost reductions.  
           (b) "Guaranteed energy savings contract" means a contract 
        for the evaluation and recommendations of energy conservation 
        measures, and for one or more energy conservation measures.  The 
        contract must provide that all payments, except obligations on 
        termination of the contract before its expiration, are to be 
        made over time, but not to exceed ten 15 years from the date of 
        final installation, and the savings are guaranteed to the extent 
        necessary to make payments for the systems. 
           (c) "Qualified provider" means a person or business 
        experienced in the design, implementation, and installation of 
        energy conservation measures.  A qualified provider to whom the 
        contract is awarded shall give a sufficient bond to the 
        municipality for its faithful performance. 
           Notwithstanding any law to the contrary, a municipality may 
        enter into a guaranteed energy savings contract with a qualified 
        provider to significantly reduce energy or operating costs. 
           Before entering into a contract under this subdivision, the 
        municipality shall provide published notice of the meeting in 
        which it proposes to award the contract, the names of the 
        parties to the proposed contract, and the contract's purpose. 
           Before installation of equipment, modification, or 
        remodeling, the qualified provider shall first issue a report, 
        summarizing estimates of all costs of installations, 
        modifications, or remodeling, including costs of design, 
        engineering, installation, maintenance, repairs, or debt 
        service, and estimates of the amounts by which energy or 
        operating costs will be reduced. 
           A guaranteed energy savings contract that includes a 
        written guarantee that savings will meet or exceed the cost of 
        energy conservation measures is not subject to competitive 
        bidding requirements of section 471.345 or other law or city 
        charter.  The contract is not subject to section 123B.52. 
           A municipality may enter into a guaranteed energy savings 
        contract with a qualified provider if, after review of the 
        report, it finds that the amount it would spend on the energy 
        conservation measures recommended in the report is not likely to 
        exceed the amount to be saved in energy and operation costs over 
        ten 15 years from the date of installation if the 
        recommendations in the report were followed, and the qualified 
        provider provides a written guarantee that the energy or 
        operating cost savings will meet or exceed the costs of the 
        system.  The guaranteed energy savings contract may provide for 
        payments over a period of time, not to exceed ten 15 years. 
           A municipality may enter into an installment payment 
        contract for the purchase and installation of energy 
        conservation measures.  The contract must provide for payments 
        of not less than one-tenth 1/15 of the price to be paid within 
        two years from the date of the first operation, and the 
        remaining costs to be paid monthly, not to exceed a ten-year 
        15-year term from the date of the first operation. 
           Guaranteed energy savings contracts may extend beyond the 
        fiscal year in which they become effective.  The municipality 
        shall include in its annual appropriations measure for each 
        later fiscal year any amounts payable under guaranteed energy 
        savings contracts during the year.  Failure of a municipality to 
        make such an appropriation does not affect the validity of the 
        guaranteed energy savings contract or the municipality's 
        obligations under the contracts. 
           Sec. 2.  [EFFECTIVE DATE.] 
           This act is effective the day following final enactment. 
           Presented to the governor May 27, 2003 
           Signed by the governor May 30, 2003, 3:56 p.m.