Skip to main content Skip to office menu Skip to footer
Minnesota Legislature

Office of the Revisor of Statutes

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

                            CHAPTER 125-H.F.No. 2187 
                  An act relating to public and municipal corporations; 
                  creating a county subsidiary corporation to provide 
                  health care and related services, education, and 
                  research; providing for governance of Hennepin County 
                  Medical Center; amending Minnesota Statutes 2004, 
                  sections 179A.03, subdivisions 7, 14, 15; 179A.06, 
                  subdivision 2; 353.01, subdivisions 2b, 2d, 6; 353.64, 
                  subdivision 10; 353E.02, subdivision 2a; 383B.117, 
                  subdivision 2; 383B.217, subdivision 7; 383B.46; 
                  proposing coding for new law in Minnesota Statutes, 
                  chapters 179A; 383B; repealing Minnesota Statutes 
                  2004, section 383B.217, subdivisions 1, 2, 3, 4, 5, 6, 
                  8. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                   ARTICLE 1 
                           HENNEPIN HEALTHCARE SYSTEM 
           Section 1.  [383B.901] [CREATION OF A COUNTY SUBSIDIARY 
        CORPORATION.] 
           There is created a corporation which shall be public in 
        nature, operating as a subsidiary of the county of Hennepin.  
        The public corporation shall be known as Hennepin Healthcare 
        System, Inc.  The purpose of the corporation is to engage in the 
        organization and delivery of health care and related services to 
        the general public, including the indigent as defined by state 
        and federal law and as determined by the Hennepin County Board 
        of Commissioners, and to conduct related programs of education 
        and research.  The corporation shall have one class of members, 
        the governing member, who shall be Hennepin County, as 
        represented by the Hennepin County Board of Commissioners.  The 
        governing member has all the rights, duties, and privileges 
        specified under this act and the bylaws of the corporation. 
           Sec. 2.  [383B.902] [DEFINITIONS.] 
           Subdivision 1.  [TERMS.] For the purpose of this act, the 
        terms defined in this section have the meanings given them 
        unless the context clearly indicates otherwise. 
           (a) "Corporation" means the county subsidiary corporation 
        created by section 383B.901. 
           (b) "County" means the county of Hennepin. 
           (c) "County board" means the Hennepin County Board of 
        Commissioners and its members. 
           (d) "HCMC" means the Hennepin County Medical Center, which 
        is the medical center established and operated by the county 
        under section 383B.217. 
           (e) "Effective date" means the effective date of the 
        sections of this act, as defined in section 29. 
           Sec. 3.  [383B.903] [BOARD.] 
           Subdivision 1.  [GOVERNANCE.] The corporation shall be 
        governed by a board of directors consisting of between 11 and 15 
        directors.  Two of the directors on the board of the corporation 
        must be county commissioners currently serving as elected 
        officials on the county board who are chosen and may be removed 
        by a majority vote of the county board. 
           Subd. 2.  [TERM, QUORUM, AND MANNER OF ACTING.] The term of 
        office for directors, rules governing quorum, and manner of 
        acting for the board of directors must be specified in the 
        bylaws of the corporation which shall be approved by the county 
        board, except that: 
           (1) a vote of a majority of the board shall be required to 
        hire or discharge the corporation's administrator, to approve 
        the annual budget, and for any action which requires subsequent 
        approval by the county board as specified in section 383B.908; 
        and 
           (2) directors of the board of directors or any committee or 
        advisory assembly or council appointed by the board of directors 
        may participate in a meeting by means of telephone conference or 
        similar communications equipment which enables all persons 
        participating in the meeting to hear each other during the 
        conduct of that meeting.  Participation shall be considered 
        presence in person at the meeting for purposes of notice and 
        quorum requirements as specified in the bylaws. 
           Subd. 3.  [APPOINTMENT OF BOARD MEMBERS.] The county board 
        shall appoint the initial board of the corporation.  Thereafter, 
        the county board shall appoint directors of the corporation by 
        slate to open positions due to the completion of a director's 
        term as specified in the bylaws of the corporation.  The slate 
        shall be nominated by a committee of the board of the 
        corporation.  The board of the corporation may by majority vote 
        appoint a board member to fill a vacancy on the board occurring 
        prior to the completion of the term, provided the newly 
        appointed board member is submitted to the county board for 
        approval when the next slate of directors is submitted to the 
        county board for approval. 
           Subd. 4.  [QUALIFICATIONS.] Members of the board shall 
        possess a high degree of experience and knowledge in relevant 
        fields and possess a high degree of interest in the corporation 
        and support for its mission.  Members shall be appointed based 
        in part on the objective of ensuring that the corporation 
        includes diverse and beneficial perspectives and experience 
        including, but not limited to, those of medical or other health 
        professionals, urban, cultural and ethnic perspectives of the 
        population served by the corporation, business management, law, 
        finance, health sector employees, public health, serving the 
        uninsured, health professional training, and the patient or 
        consumer perspective.  The corporation shall provide a public 
        announcement of vacancies on the board of the corporation in the 
        manner normally used by Hennepin County to provide public notice 
        of open appointments. 
           Subd. 5.  [REMOVAL.] A director who is not a county 
        commissioner may be removed without cause by a two-thirds 
        majority vote of the board of the corporation.  The county board 
        may remove any board member for violation of the director's 
        ethical and legal duties as a board member as specified in 
        section 383B.905 or for the repeated failure to act in the best 
        interests of the corporation.  In addition, the county board may 
        remove the corporate board in its entirety as specified in 
        section 383B.908, subdivision 7. 
           Sec. 4.  [383B.904] [OFFICERS.] 
           Subdivision 1.  [ELECTION.] (a) The officers of the board 
        of the corporation shall consist of the chair, vice chair, 
        secretary, treasurer, and other officers as the board shall from 
        time to time deem necessary.  The board shall elect officers by 
        a majority vote of the board at the annual meeting, or in the 
        case of the initial board, at the first meeting following 
        appointment by the county board. 
           (b) Any of the offices or functions, with the exception of 
        the chair and vice chair, may be held or exercised by the same 
        person. 
           Subd. 2.  [REMOVAL.] An officer may be removed without 
        cause by a two-thirds majority vote of the board of the 
        corporation. 
           Sec. 5.  [383B.905] [AUTHORITY AND DUTIES OF OFFICERS AND 
        DIRECTORS.] 
           Subdivision 1.  [IN BYLAWS OR BY BOARD.] Officers and 
        directors have the authority and duties in the management of the 
        business of the corporation that the bylaws prescribe or, in the 
        absence of such prescription, as the board determines. 
           Subd. 2.  [ORDINARY PRUDENT PERSON STANDARD.] Officers and 
        directors shall discharge their duties in good faith, in the 
        manner the officer or director reasonably believes to be in the 
        best interests of the corporation, and with the care an ordinary 
        prudent person in a like position would exercise under similar 
        circumstances. 
           Subd. 3.  [NOT TRUSTEES.] Officers and directors are not 
        considered to be trustees with respect to the corporation or 
        with respect to property held or administered by the 
        corporation, including, without limit, property that may be 
        subject to restrictions imposed by the donor or transferor of 
        the property. 
           Sec. 6.  [383B.906] [BYLAWS.] 
           Prior to the appointment of the initial board of the 
        corporation, the county board shall approve the bylaws of the 
        corporation.  Thereafter, the board of the corporation may 
        adopt, amend, or repeal bylaws relating to the management of the 
        business or regulation of the affairs of the corporation, except 
        that the county board shall approve any bylaws change relating 
        to: 
           (1) board composition, board and officer selection, terms, 
        removal, or qualifications; 
           (2) the county board's reserved powers as specified in the 
        bylaws; 
           (3) the ability of the corporation to engage in joint 
        ventures; 
           (4) the ability of the corporation to incur debt through 
        the county; 
           (5) the ability of the corporation to create subsidiaries; 
           (6) the ability of the corporation to merge or dissolve; 
           (7) the ability of the corporation to use subsidiaries to 
        undertake functions or activities performed by employees of the 
        corporation; or 
           (8) the mission of the corporation. 
           Sec. 7.  [383B.907] [CORPORATE POWERS.] 
           Subdivision 1.  [AUTHORITY AND POWERS OF THE 
        BOARD.] Subject to the reserved powers and limitations specified 
        in sections 383B.903 and 383B.908, or as specified in the bylaws 
        of the corporation, the corporation, through its board, shall, 
        relative to the delivery of health care services, have, in 
        addition to any authority vested by law, the authority and legal 
        capacity of a nonprofit corporation under chapter 317A including 
        the authority to: 
           (1) have members of its board or its officers or 
        administrators serve as directors, officers, or employees of the 
        corporation's ventures, associations, or corporations; 
           (2) hire and discharge an administrator; 
           (3) approve personnel policies and practices, any 
        applicable labor agreements, and levels of compensation and 
        benefits recommended by the administrator; 
           (4) use employees, agents, consultants, and facilities of 
        the county, as necessary in the discretion of the board, paying 
        the county its agreed proportion of the compensation or costs 
        pursuant to an agreement with the county; 
           (5) spend funds, including public funds in any form, or 
        devote the resources of the corporation to recruit and retain 
        physicians whose services are necessary or desirable for meeting 
        the health care needs of the population and for the successful 
        performance of the public purpose of the corporation.  Allowable 
        uses of funds and resources include the retirement of medical 
        education debt, payment of onetime amounts in consideration of 
        services rendered or to be rendered, payment of recruitment 
        expenses, payment of moving expenses, and the provision of other 
        financial assistance necessary for the recruitment and retention 
        of physicians, provided that the expenditures in whatever form 
        are reasonable under the facts and circumstances of the 
        situation; 
           (6) offer, directly or indirectly, products and services of 
        the corporation and/or affiliated entities to the general 
        public, and retain any profits earned through the provision of 
        these products and services for the purpose of advancing the 
        mission of the corporation; 
           (7) own shares of stock in business corporations; 
           (8) borrow money and issue bonds in support and promotion 
        of the corporation's purpose and mission and providing any 
        rights and obligations related thereto; 
           (9) accept gifts, grants, loans, or contributions of funds 
        or property or financial or other aid in any form from, and 
        enter into contracts or other transactions with, the federal 
        government, the state of Minnesota, third-party payors, or any 
        other source, and to use any gifts, grants, loans, or 
        contributions for any of its corporate purposes; 
           (10) enter shared service and other cooperative ventures; 
           (11) join or sponsor membership in organizations intended 
        to benefit the corporation; 
           (12) enter partnerships, joint ventures, or other business 
        arrangements to advance the mission of the corporation; 
           (13) sue or be sued; and 
           (14) incorporate other corporations, both for profit and 
        nonprofit. 
           Subd. 2.  [OTHER POWERS.] Subject to the reserved powers 
        and limitations specified in sections 383B.903 and 383B.908, or 
        as specified in the bylaws of the corporation, the corporation 
        shall have all the powers necessary and convenient for the 
        operation, administration, management, and control of the 
        corporation's affairs.  The enumeration of specific powers in 
        this section is not intended to restrict the power of the 
        corporation to take any action which, in the exercise of its 
        discretion, is necessary or convenient to further the purposes 
        for which the corporation exists and that is not otherwise 
        prohibited by law, whether or not the power to take the action 
        is necessarily implied from the powers expressly granted.  
           Sec. 8.  [383B.908] [LIMITATIONS UPON CORPORATE POWERS; 
        RESERVED POWERS.] 
           Subdivision 1.  [POWERS RESERVED TO THE 
        COUNTY.] Notwithstanding the authority granted to the board in 
        section 383B.907, the county board shall retain specific 
        controls over the corporation's mission, ability to incur 
        indebtedness through the county, indigent care, and governance.  
        These county board controls must be specified in the bylaws or 
        other transactional documents, which shall be approved by the 
        county board. 
           Subd. 2.  [RESTRICTION ON DISPOSITION OF THE ASSETS.] The 
        corporation shall not have the power to dissolve, merge, 
        consolidate, transfer, liquidate, or otherwise dispose of or 
        distribute all, or substantially all, of the corporation's 
        assets without a county board resolution approved by a majority 
        of the county board. 
           Subd. 3.  [DISTRIBUTION OF ASSETS UPON DISSOLUTION.] In the 
        event of the dissolution of the corporation, the net assets of 
        the corporation shall be distributed to the county for public 
        purposes. 
           Subd. 4.  [COMPENSATION AND PAYMENT LIMITATIONS.] No part 
        of the net earnings and assets of the corporation shall inure to 
        the benefit of any private individual, nor shall any part of the 
        income or assets of the corporation be distributed to or divided 
        among any private individuals as dividends or otherwise. 
           Subd. 5.  [FINANCIAL OVERSIGHT.] The county board shall 
        approve the annual budget of the corporation and receive an 
        annual audited financial statement.  The annual budget shall 
        address how efficiencies and revenues contribute to stabilize or 
        reduce county liabilities for indigent care.  The county board 
        shall also retain the right to conduct an independent audit of 
        the finances of the corporation. 
           Subd. 6.  [COUNTY SERVICES.] The county board shall retain 
        the authority to require the corporation to provide other health 
        care or health care related services as the county board 
        determines to be in the best interest of the county.  The 
        corporation shall provide these services as long as the county 
        board provides funds to pay for the services.  Payment to the 
        corporation for the services shall be as agreed between the 
        corporation and the county board. 
           Subd. 7.  [DISSOLUTION OR REORGANIZATION OF THE 
        CORPORATION.] The county board shall retain the right to 
        dissolve the corporation, reorganize the corporation, or remove 
        the entire corporate board in order to resume management of 
        Hennepin County Medical Center upon a two-thirds vote of the 
        entire county board. 
           Sec. 9.  [383B.909] [CORPORATE SEAL.] 
           The corporation shall not have a corporate seal.  
           Sec. 10.  [383B.910] [BOARD MEETINGS.] 
           In accordance with the bylaws of the corporation, the board 
        shall provide for annual, regular, and special meetings to be 
        held at a designated interval throughout the year.  Notice of 
        these meetings shall be provided in accordance with the bylaws 
        of the corporation. 
           Sec. 11.  [383B.911] [PUBLIC DEPOSITORY.] 
           The corporation shall have jurisdiction over its accounts 
        and payrolls and shall establish and maintain a public 
        depository.  The corporation may use the county as a public 
        depository.  If the depository is not the county, the depository 
        must be subject to chapter 118A, except that the corporation 
        shall determine the appropriate security.  The corporation shall 
        establish and maintain all necessary accounts.  The corporation 
        may establish reserve accounts, depreciation accounts, and 
        working capital funds in order to operate on an accrual basis. 
           Sec. 12.  [383B.912] [TRANSFER OF RIGHTS.] 
           Subdivision 1.  [CORPORATION AS CONTINUATION OF HCMC.] The 
        corporation created by section 383B.901 shall be considered a 
        continuation of HCMC for purposes of all the rights, 
        liabilities, and contractual obligations of the county 
        pertaining to the operations of HCMC except as otherwise 
        provided herein.  The corporation succeeds to all rights and 
        contractual obligations of the county pertaining to the 
        operations of HCMC with the same force and effect as if those 
        rights and obligations had been continued by the county itself. 
           Subd. 2.  [PENDING MATTERS.] The corporation may conduct 
        and complete any legal action, administrative proceeding, or any 
        other matter commenced by or against HCMC or the county, on 
        behalf of HCMC, which was incurred before or pending as of the 
        effective date, in the same manner, under the same conditions, 
        and with the same effect as though the action, proceeding, or 
        other matter were conducted or completed by HCMC or the county 
        acting on behalf of HCMC. 
           Subd. 3.  [TRANSFER OF DOCUMENTS REQUIRED.] On the 
        effective date, HCMC, or the county on behalf of HCMC, shall 
        have the authority to transfer and deliver to the corporation, 
        as specified in the lease and other transactional documents 
        referenced in section 383B.913, all contracts, books, bonds, 
        plans, paper, records, including all personnel and medical 
        records, and other property of every description within the 
        jurisdiction or control of HCMC, or the county acting on behalf 
        of HCMC, except as otherwise provided herein. 
           Subd. 4.  [TRANSFER OF FUNDS.] On the effective date, HCMC, 
        or the county on behalf of HCMC, shall have the authority to 
        transfer to the corporation all unspent funds appropriated to 
        HCMC, as specified in the lease and other transactional 
        documents referenced in section 383B.913. 
           Sec. 13.  [383B.913] [LEASE OR TRANSFER OF ASSETS.] 
           Subdivision 1.  [CORPORATE STATUS.] The corporation shall 
        be considered a "public corporation" for purposes of section 
        465.035. 
           Subd. 2.  [LEASE OF REAL PROPERTY.] Notwithstanding any 
        other laws to the contrary, as of the effective date, the county 
        shall have the authority to enter into a lease, mutually 
        agreeable to both parties, with the corporation for 
        substantially all of the real property acquired by or turned 
        over to the county for the establishment, operation, or 
        maintenance of HCMC prior to and as of the effective date and 
        necessary for the operation of the corporation.  Subject to 
        restrictions specified in the written lease and other 
        transaction documents by and between the county and the 
        corporation, the county shall lease the real property 
        exclusively to the corporation.  For the purposes of this 
        subdivision, real property shall mean the real property used by 
        the county for the operations of HCMC that the county shall 
        lease to Hennepin Healthcare System, Inc., as specified in the 
        lease documents and this act as of the effective date. 
           Subd. 3.  [REQUIREMENTS OF LEASE.] In order for the county 
        to enter into the lease described in subdivision 2, the lease 
        must also address the following: 
           (1) continued primary use of the property for health and 
        hospital services; 
           (2) indigent care; 
           (3) capital improvements; 
           (4) joint ventures and partnerships; 
           (5) assignments and subleases; and 
           (6) changes to hospital capacity. 
           Subd. 4.  [TRANSFER OF ASSETS.] The county shall transfer 
        to the corporation assets as designated by the county in 
        transactional documents accompanying the lease for use in the 
        operations of HCMC.  For purposes of this subdivision, assets 
        means the equipment and other personal property used by the 
        county for the operations of HCMC that the county shall transfer 
        to Hennepin Healthcare System, Inc., as specified in the 
        transaction documents and this act as of the effective date. 
           Subd. 5.  [NO ADVERTISING OR BIDS.] The county may transfer 
        and lease the assets and real property to the corporation as 
        specified in subdivisions 2 and 3 without first advertising for 
        or soliciting any bids. 
           Sec. 14.  [383B.914] [STATUS OF PRESENT EMPLOYEES; 
        BARGAINING UNITS; RETIREMENT COVERAGE.] 
           Subdivision 1.  [HEALTH SYSTEM HUMAN RESOURCES 
        SYSTEM.] Persons employed at the corporation created shall be 
        subject to a human resources system that is designed to offer 
        appropriate benefits to workers employed in a health care 
        setting.  This human resources system shall replace the general 
        county human resources system prescribed in sections 383B.26 to 
        383B.42, and any rules related to it.  The corporation shall 
        have the authority to establish all personnel policies and 
        practices, negotiate applicable labor agreements, and set all 
        levels of compensation and benefits which are considered 
        appropriate by the board except as limited in this section.  The 
        human resources system is subject to the following human 
        resources requirements: 
           (1) determine compensation according to the pay equity 
        requirements under sections 471.991 to 471.999; 
           (2) provide preferences for veterans according to the 
        Veterans Preference Act under sections 197.455, 197.46, and 
        375.63; and 
           (3) provide an appeals process for an individual who is 
        discharged, demoted, or suspended. 
           Subd. 2.  [EMPLOYEE TRANSFER.] All persons employed by the 
        county whose employment is accounted for in the county 
        enterprise fund for HCMC, on the effective date, shall be 
        transferred to the corporation as specified in the lease and 
        other transactional documents referenced in section 383B.913.  
        The transfer of employees to the corporation under this 
        subdivision does not constitute severance or termination of 
        employment or a layoff entitling transferred employees to 
        severance pay, termination benefits, a retirement plan refund, 
        or any other right that may be applicable in the case of 
        severance, termination, or layoff. 
           Subd. 3.  [CURRENT POSITIONS.] Each person employed by the 
        county who is transferred to the corporation on the effective 
        date shall retain employment and accrued benefits, including 
        participation in deferred compensation programs, and will be 
        recorded by most recent date of employment with Hennepin County 
        upon transfer to the corporation created in section 383B.901.  
           Subd. 4.  [BARGAINING UNITS.] The corporation shall 
        recognize existing bargaining units organized by employees of 
        HCMC and the exclusive representatives of those bargaining units 
        as of the effective date.  The corporation shall adopt all 
        current labor agreements as of the effective date for the term 
        of those agreements, except for countywide references, 
        countywide provisions, and countywide human resources rules. 
           Subd. 5.  [GENERAL EMPLOYEE RETIREMENT BENEFITS.] (a) 
        Except as provided in paragraph (b), employees of the 
        corporation, other than paramedics, emergency medical 
        technicians and the supervisors and managers of such employees, 
        and protection officers and supervisors of such employees, are 
        "public employees" under chapter 353 and are members of the 
        general employees retirement plan of the Public Employees 
        Retirement Association, including employees transferred to the 
        corporation under subdivision 2 and employees hired by the 
        corporation after the effective date. 
           (b) Notwithstanding sections 356.24 and 356.25, the 
        corporation has the authority to create alternative retirement 
        plans that are not defined benefit pension plans for the 
        following classes of employees:  supervisors, managers, 
        physicians, and independent health practitioners who bill 
        independently for their time, provided the value of the 
        aggregate benefits are substantially comparable to the general 
        employee retirement plan of the Public Employees Retirement 
        Association.  These classes of employees are eligible to 
        participate in the general retirement plan of the Public 
        Employees Retirement Association until and unless the 
        corporation creates alternative retirement plans.  Only those 
        employees who are within the designated class and who are hired 
        after the date of creation of the alternative plan may be 
        enrolled in the alternative retirement plan in lieu of 
        participation in the general employees retirement plan of the 
        Public Employees Retirement Association.  Any alternative 
        retirement benefit plan established by the corporation must 
        comply with the financial reporting requirements for public 
        pension plans under section 356.20 and the investment 
        performance reporting requirements for public pension plans 
        under section 356.219. 
           Subd. 6.  [EMPLOYEES ELIGIBLE TO CONTINUE PARTICIPATION IN 
        PUBLIC EMPLOYEE RETIREMENT ASSOCIATION CORRECTIONAL, POLICE AND 
        FIRE BENEFIT PLANS.] Notwithstanding subdivision 5, both 
        existing and future employees of the corporation in the 
        positions of paramedic and emergency medical technician, 
        including supervisors and managers of such employees, as 
        provided in section 353.64, subdivision 10, are members of the 
        public employees police and fire retirement plan under sections 
        353.63 to 353.68 and in the position of protection officer, 
        including supervisors of such employees, as provided in section 
        353E.02, subdivision 2a, are members of the local government 
        correctional retirement plan under chapter 353E. 
           Subd. 7.  [PARTICIPATION IN STATE DEFERRED COMPENSATION 
        PLAN.] (a) Existing employees of the corporation, at the 
        election of the corporation, if otherwise qualified, are 
        eligible to participate in the Hennepin County supplemental 
        retirement plan under sections 383B.46 and 383B.52. 
           (b) Existing and future employees of the corporation, at 
        the election of the corporation, are eligible to participate in 
        the Minnesota state deferred compensation plan under section 
        352.96, the postretirement health care savings plan under 
        section 352.98, and all other deferred compensation arrangements 
        for which all persons employed by the county whose employment is 
        accounted for in the county enterprise fund for HCMC were 
        eligible. 
           Subd. 8.  [SUBSIDIARIES.] Any subsidiary created by the 
        corporation shall be subject to the same human resources 
        requirements as those that apply to the corporation under 
        subdivision 1.  
           Sec. 15.  [383B.915] [BONDING AUTHORITY OF CORPORATION.] 
           Subdivision 1.  [MUNICIPALITY.] The corporation shall be 
        considered a "municipality" pursuant to section 475.51, 
        subdivision 2, for purposes of bond issuance and shall have all 
        the authority conferred on municipalities by chapter 475, unless 
        that authority is modified in this section. 
           Subd. 2.  [SALE OF BONDS.] Subject to the reserved powers 
        and limitations specified in section 383B.908 and 
        notwithstanding any of the corporation's enumerated powers, the 
        corporation may issue and sell revenue bonds or other revenue 
        obligations to finance capital improvements or for the 
        acquisition and betterment of facilities or other property to be 
        utilized for the delivery of health care and related research, 
        the establishment of reserves for bond payment, or for other 
        proper corporate purposes. 
           Subd. 3.  [SECURITY FOR BONDS.] Subject to the reserved 
        powers and limitations specified in section 383B.908 and 
        notwithstanding any of the corporation's enumerated powers, the 
        bonds may be secured by a mortgage of or security interest in 
        any property owned by the corporation or any interest of the 
        corporation in any property and by a pledge of revenues to be 
        derived from operation of the corporation's facilities as a 
        first and prior lien thereon or as a lien subordinate to the 
        costs of operation and maintenance of the facilities.  The bonds 
        must be in an amount, and shall mature, as provided by 
        resolution of the board and may be issued in one or more series 
        and shall bear a date or dates, bear interest at a rate or 
        rates, be in a denomination or denominations, be in the form 
        either coupon or registered, carry the conversion or 
        registration privileges, have rank or priority, be executed in 
        the manner, be payable in medium of payment at the place or 
        places, and be subject to the terms of redemption, with or 
        without premium, as the resolution may provide.  The bonds may 
        be sold at public or private sale at a price or prices 
        determined by the resolution.  Notwithstanding any law to the 
        contrary, the bonds must be fully negotiable.  The corporation 
        may enter into the covenants the board, by resolution, shall 
        deem necessary and proper to secure payment of the bonds.  The 
        revenue bonds must state on their face that they are not payable 
        from, nor may be a charge upon, any funds other than the 
        revenues and property pledged or mortgaged for their payment, 
        nor shall the corporation be subject to any liability on them or 
        have the power to obligate itself to pay or pay the revenue 
        bonds from funds other than the revenues and property pledged 
        and mortgaged.  No holder or holders of the bonds shall ever 
        have the right to compel any exercise of any taxing power of the 
        county or any other public body to pay the principal of or 
        interest on any of them, nor to enforce payment of them against 
        any property other than that expressly pledged or mortgaged for 
        their payment. 
           Sec. 16.  [383B.916] [FINANCING THROUGH COUNTY.] 
           In addition to the authority granted in section 16, the 
        county may finance any improvements, equipment, or other 
        property to be operated by the corporation and may issue bonds 
        for such purposes pursuant to and subject to the procedures and 
        limitations set forth in section 373.40, 383B.117, 447.45, or 
        other law, as appropriate, whether or not the capital 
        improvement or equipment to be financed is to be owned by the 
        county or the corporation. 
           Sec. 17.  [383B.917] [OPEN MEETING LAW; GOVERNMENT DATA 
        PRACTICES ACT.] 
           Subdivision 1.  [DATA PRACTICES ACT.] (a) The corporation 
        is subject to chapter 13, the Minnesota Government Data 
        Practices Act.  
           (b) "Competitive data," as defined in this subdivision, are 
        nonpublic data pursuant to section 13.02, subdivision 9, or 
        private data on individuals pursuant to section 13.02, 
        subdivision 12.  Competitive data are any type of data that the 
        corporation, in its discretion, determines that if disclosed 
        could cause competitive disadvantage to the corporation, 
        including causing adverse effects on the current or future 
        competitive position of the corporation or the entities, 
        facilities, and operations for which it is responsible.  Data 
        discussed at an open meeting of the corporation retains the 
        data's original classification, including classification as 
        competitive data, as provided in section 13D.05, subdivision 1, 
        paragraph (c).  Any data disseminated by the corporation to the 
        county shall retain the same classification in the hands of the 
        county, including the classification as competitive data, as 
        provided in section 13.03, subdivision 4. 
           (c) A subsidiary, joint venture, association, partnership, 
        or other entity that is formed by the corporation is not subject 
        to chapter 13, except that if the corporation enters into a 
        contract with such an entity to perform any functions of the 
        corporation, the corporation shall include in the contract terms 
        that make it clear that data created, collected, received, 
        stored, used, maintained, or disseminated by the contracting 
        entity in performing those functions is subject to the same 
        requirements under chapter 13 as the corporation under this 
        subdivision.  However, this section does not create a duty on 
        the part of the contracting entity to provide access to public 
        data to the public if the public data are available from the 
        corporation, except as required by the terms of the contract.  
        Any entity contracting to perform functions of the corporation 
        may classify data as competitive data as defined in paragraph 
        (b). 
           Subd. 2.  [OPEN MEETING LAW.] (a) The board of directors of 
        the corporation is subject to chapter 13D, the Minnesota Open 
        Meeting Law.  
           (b) The board may close all or part of a board meeting when 
        discussing competitive data or considering strategic, business, 
        planning, or operational issues the disclosure of which, in its 
        discretion, it determines could cause competitive disadvantage 
        to the corporation, including causing adverse effects on the 
        current or future competitive position of the corporation or the 
        entities, facilities, and operations for which it is 
        responsible.  Meetings of committees of the board of directors 
        may, at the discretion of the board, be closed to the public.  
           (c) In addition, the following meetings of the corporation 
        shall be held and shall be open meetings:  (1) an annual public 
        meeting to report on the affairs of the corporation and the 
        goals for the future, including a report on the health services 
        plan specified in section 383B.918; (2) meetings of the 
        corporation held during the development and implementation phase 
        of the health services plan for the purpose of informing the 
        public and receiving public comment; and (3) that portion of a 
        meeting at which the board of the corporation approves the 
        annual budget prior to submission to the county board for 
        approval.  Meetings held under clause (1) or (2) may be chaired 
        by a member of the board of directors or a member of the 
        administration as designated by the board of directors.  Except 
        as provided in paragraphs (a), (b), and (c), other meetings of 
        the corporation are not subject to chapter 13D.  
           (d) Chapter 13D does not apply to a subsidiary, joint 
        venture, association, or partnership of the corporation unless 
        such entity has been organized to assume management of the 
        corporation. 
           Sec. 18.  [383B.918] [HEALTH SERVICES PLAN.] 
           The corporation shall prepare, and submit to the county 
        board for review and approval, a health services plan that draws 
        from a population health needs assessment and delineates the 
        corporation's role in the community, including education, 
        research, and services to improve the health status of the 
        community including indigent populations.  The health services 
        plan shall contain a description of how the corporation shall 
        continue to coordinate with the county to provide health-related 
        services to the residents of Hennepin County, including the 
        indigent as defined by state and federal law and as determined 
        by the Hennepin County Board of Commissioners. 
           Sec. 19.  [383B.919] [TORT LIABILITY.] 
           The corporation shall be a "municipality" for purposes of 
        tort liability pursuant to chapter 466; except that chapter 466 
        does not apply to an action against any subsidiary, joint 
        venture, association, or partnership of the corporation alleging 
        malpractice, error, mistake, or failure to cure because of the 
        actions of physicians or other health care providers employed by 
        the entity, unless that entity has been organized to assume 
        management of the entire corporation. 
           Sec. 20.  [383B.920] [REVENUE RECAPTURE ACT.] 
           The corporation shall be considered a "claimant agency" for 
        purposes of the Revenue Recapture Act, chapter 270A. 
           Sec. 21.  [383B.921] [PURCHASING.] 
           Subdivision 1.  [PUBLIC PROCUREMENT.] Notwithstanding any 
        law to the contrary, contracting and purchasing of goods, 
        materials, supplies, equipment, and services that are included 
        as part of a contract for the purchase of goods, materials, 
        supplies, equipment, or services are specifically exempted from 
        sections 383B.141 to 383B.151 and 471.345 to 471.371, or other 
        applicable laws related to public procurement. 
           Subd. 2.  [PURCHASING AND SERVICE CONTRACTS.] The 
        corporation may purchase directly or utilize the services of a 
        nonprofit cooperative hospital service organization, the county, 
        the state of Minnesota, the University of Minnesota, or any 
        other political subdivision or agency of the state of Minnesota 
        in the purchase of all goods, materials, and services that the 
        corporation may require. 
           Sec. 22.  [383B.922] [LEGAL COUNSEL.] 
           With respect to the provisions of section 388.051, the 
        corporation shall be deemed a part of Hennepin County for 
        purposes of the Hennepin County attorney serving as legal 
        counsel to the corporation; provided, however, that the 
        corporation and the Hennepin County attorney may enter into an 
        arrangement with respect to the hiring of outside counsel on 
        behalf of the corporation.  The corporation shall reimburse the 
        county for legal services provided by the Hennepin County 
        attorney, including any and all costs, and the reimbursement 
        shall be credited to the budget of the Hennepin County attorney. 
           Sec. 23.  [383B.923] [SELF-INSURANCE.] 
           Subdivision 1.  [SELF-INSURANCE.] The corporation may 
        participate in any self-insurance program established by the 
        county in accordance with section 383B.155. 
           Subd. 2.  [ADDITIONAL BENEFITS TO EMPLOYEES.] The 
        corporation may provide for the payment of additional benefits 
        to employees from their accumulated vacation, sick leave, or 
        overtime credits if the employees of the corporation and any of 
        its subsidiaries are entitled to the benefits of the Workers' 
        Compensation Law and have at the time of compensable injury 
        accumulated credits under a vacation, sick leave, or overtime 
        plan or system maintained by the corporation.  The additional 
        payments to an employee may not exceed the amount of the total 
        sick leave, vacation, or overtime credits accumulated by the 
        employee and shall not result in the payment of a total weekly 
        rate of compensation that exceeds the weekly wage of the 
        employee.  The additional payments to any employee shall be 
        charged against the sick leave, vacation, and overtime credits 
        accumulated by the employee.  Employees of the corporation and 
        any of its subsidiaries entitled to the benefits of the Workers' 
        Compensation Law may receive additional benefits pursuant to a 
        collective bargaining agreement or other plan, entered into or 
        in effect on or after January 1, 2003, providing payments by or 
        on behalf of the employer, and these additional benefits may be 
        unrelated to any accumulated sick leave, holiday, or overtime 
        credits and need not be charged against any accumulation; 
        provided that the additional payments must not result in the 
        payment of a total weekly rate of compensation that exceeds the 
        weekly wage of the employee.  The corporation and its 
        subsidiaries may adopt rules and regulations consistent with 
        chapter 179, to carry out the section relating to payment of 
        additional benefits to employees from accumulated sick leave, 
        vacation, overtime credits, or other sources. 
           Sec. 24.  [383B.924] [HOSPITAL AUTHORITIES.] 
           The corporation shall not be considered a hospital or 
        hospital district subject to section 144.581. 
           Sec. 25.  [383B.925] [TAX-EXEMPT STATUS.] 
           The corporation is an organization exempt from taxation 
        pursuant to chapters 290 and 297A. 
           Sec. 26.  [383B.926] [PREPAID HEALTH PLAN.] 
           The corporation is a county-affiliated public teaching 
        hospital for purposes of section 256D.03, subdivision 4. 
           Sec. 27.  [383B.927] [INTERGOVERNMENTAL TRANSFERS.] 
           For purposes of medical assistance, Medicaid, Medicare, and 
        other public programs, the corporation shall continue to be a 
        "unit of state or local government" and a "government owned or 
        operated hospital," and shall be eligible to receive 
        "intergovernmental transfers" and "certified public expenditures"
        as may be authorized from time to time by the state of Minnesota 
        or Hennepin County. 
           Sec. 28.  [383B.928] [INDIGENT CARE.] 
           Subdivision 1.  [SERVICES.] The corporation shall provide 
        health care and related services for the indigent of the county 
        as required by the terms of the lease as specified in section 
        383B.913, subdivisions 2 and 3, consistent with any agreement 
        for payment for those services made with the county. 
           Subd. 2.  [FUNDS.] Notwithstanding any law to the contrary, 
        the county may provide funds for the purchase of medical care 
        for the indigent of the county from a provider selected by the 
        county with or without public bid. 
           Sec. 29.  [EFFECTIVE DATES.] 
           (a) Sections 3 to 8, regarding governance and corporate 
        powers; section 14, subdivision 1, regarding the establishment 
        of personnel policies; and section 17, regarding the Minnesota 
        Open Meeting Law and the Government Data Practices Act are 
        effective when the initial board of the corporation is appointed 
        by the county board.  
           (b) The remaining sections of the bill are effective the 
        day after the county board files a certificate of local approval 
        in compliance with Minnesota Statutes, section 645.021, 
        subdivision 3, after which the corporation shall commence 
        operation and management of Hennepin County Medical Center. 

                                   ARTICLE 2 
                        LABOR RELATIONS; RELATED ISSUES 
           Section 1.  Minnesota Statutes 2004, section 179A.03, 
        subdivision 7, is amended to read: 
           Subd. 7.  [ESSENTIAL EMPLOYEE.] "Essential employee" means 
        firefighters, peace officers subject to licensure under sections 
        626.84 to 626.863, 911 system and police and fire department 
        public safety dispatchers, guards at correctional facilities, 
        confidential employees, supervisory employees, assistant county 
        attorneys, assistant city attorneys, principals, and assistant 
        principals.  However, for state employees, "essential employee" 
        means all employees in law enforcement, health care 
        professionals, correctional guards, professional engineering, 
        and supervisory collective bargaining units, irrespective of 
        severance, and no other employees.  For University of Minnesota 
        employees, "essential employee" means all employees in law 
        enforcement, nursing professional and supervisory units, 
        irrespective of severance, and no other employees.  
        "Firefighters" means salaried employees of a fire department 
        whose duties include, directly or indirectly, controlling, 
        extinguishing, preventing, detecting, or investigating fires.  
        Employees for whom the state court administrator is the 
        negotiating employer are not essential employees.  For Hennepin 
        Healthcare System, Inc. employees, "essential employees" means 
        all employees. 
           Sec. 2.  Minnesota Statutes 2004, section 179A.03, 
        subdivision 14, is amended to read: 
           Subd. 14.  [PUBLIC EMPLOYEE OR EMPLOYEE.] "Public employee" 
        or "employee" means any person appointed or employed by a public 
        employer except:  
           (a) elected public officials; 
           (b) election officers; 
           (c) commissioned or enlisted personnel of the Minnesota 
        National Guard; 
           (d) emergency employees who are employed for emergency work 
        caused by natural disaster; 
           (e) part-time employees whose service does not exceed the 
        lesser of 14 hours per week or 35 percent of the normal work 
        week in the employee's appropriate unit; 
           (f) employees whose positions are basically temporary or 
        seasonal in character and:  (1) are not for more than 67 working 
        days in any calendar year; or (2) are not for more than 100 
        working days in any calendar year and the employees are under 
        the age of 22, are full-time students enrolled in a nonprofit or 
        public educational institution prior to being hired by the 
        employer, and have indicated, either in an application for 
        employment or by being enrolled at an educational institution 
        for the next academic year or term, an intention to continue as 
        students during or after their temporary employment; 
           (g) employees providing services for not more than two 
        consecutive quarters to the Board of Trustees of the Minnesota 
        State Colleges and Universities under the terms of a 
        professional or technical services contract as defined in 
        section 16C.08, subdivision 1; 
           (h) employees of charitable hospitals as defined by section 
        179.35, subdivision 3; 
           (i) full-time undergraduate students employed by the school 
        which they attend under a work-study program or in connection 
        with the receipt of financial aid, irrespective of number of 
        hours of service per week; 
           (j) an individual who is employed for less than 300 hours 
        in a fiscal year as an instructor in an adult vocational 
        education program; 
           (k) an individual hired by the Board of Trustees of the 
        Minnesota State Colleges and Universities to teach one course 
        for three or fewer credits for one semester in a year; 
           (l) with respect to court employees: 
           (1) personal secretaries to judges; 
           (2) law clerks; 
           (3) managerial employees; 
           (4) confidential employees; and 
           (5) supervisory employees.; 
           (m) with respect to employees of Hennepin Healthcare 
        System, Inc., managerial, supervisory, and confidential 
        employees. 
           The following individuals are public employees regardless 
        of the exclusions of clauses (e) and (f):  
           (i) An employee hired by a school district or the Board of 
        Trustees of the Minnesota State Colleges and Universities except 
        at the university established in section 136F.13 or for 
        community services or community education instruction offered on 
        a noncredit basis:  (A) to replace an absent teacher or faculty 
        member who is a public employee, where the replacement employee 
        is employed more than 30 working days as a replacement for that 
        teacher or faculty member; or (B) to take a teaching position 
        created due to increased enrollment, curriculum expansion, 
        courses which are a part of the curriculum whether offered 
        annually or not, or other appropriate reasons; and 
           (ii) An employee hired for a position under clause (f)(1) 
        if that same position has already been filled under clause 
        (f)(1) in the same calendar year and the cumulative number of 
        days worked in that same position by all employees exceeds 67 
        calendar days in that year.  For the purpose of this paragraph, 
        "same position" includes a substantially equivalent position if 
        it is not the same position solely due to a change in the 
        classification or title of the position. 
           Sec. 3.  Minnesota Statutes 2004, section 179A.03, 
        subdivision 15, is amended to read: 
           Subd. 15.  [PUBLIC EMPLOYER OR EMPLOYER.] "Public employer" 
        or "employer" means:  
           (a) the state of Minnesota for employees of the state not 
        otherwise provided for in this subdivision or section 179A.10 
        for executive branch employees; 
           (b) the Board of Regents of the University of Minnesota for 
        its employees; 
           (c) the state court administrator for court employees; 
           (d) the state Board of Public Defense for its employees; 
        and 
           (e) Hennepin Healthcare System, Inc.; and 
           (f) notwithstanding any other law to the contrary, the 
        governing body of a political subdivision or its agency or 
        instrumentality which has final budgetary approval authority for 
        its employees.  However, the views of elected appointing 
        authorities who have standing to initiate interest arbitration, 
        and who are responsible for the selection, direction, 
        discipline, and discharge of individual employees shall be 
        considered by the employer in the course of the discharge of 
        rights and duties under sections 179A.01 to 179A.25.  
           When two or more units of government subject to sections 
        179A.01 to 179A.25 undertake a project or form a new agency 
        under law authorizing common or joint action, the employer is 
        the governing person or board of the created agency.  The 
        governing official or body of the cooperating governmental units 
        shall be bound by an agreement entered into by the created 
        agency according to sections 179A.01 to 179A.25.  
           "Public employer" or "employer" does not include a 
        "charitable hospital" as defined in section 179.35, subdivision 
        2.  
           Nothing in this subdivision diminishes the authority 
        granted pursuant to law to an appointing authority with respect 
        to the selection, direction, discipline, or discharge of an 
        individual employee if this action is consistent with general 
        procedures and standards relating to selection, direction, 
        discipline, or discharge which are the subject of an agreement 
        entered into under sections 179A.01 to 179A.25.  
           Sec. 4.  Minnesota Statutes 2004, section 179A.06, 
        subdivision 2, is amended to read: 
           Subd. 2.  [RIGHT TO ORGANIZE.] Public employees have the 
        right to form and join labor or employee organizations, and have 
        the right not to form and join such organizations.  Public 
        employees in an appropriate unit have the right by secret ballot 
        to designate an exclusive representative to negotiate grievance 
        procedures and the terms and conditions of employment with their 
        employer.  Confidential employees of the state, confidential 
        court employees, and confidential University of Minnesota 
        employees are excluded from bargaining.  Supervisory and 
        managerial court employees are excluded from 
        bargaining.  Supervisory, managerial, and confidential employees 
        of Hennepin Healthcare System, Inc., are excluded from 
        bargaining.  Other confidential employees, supervisory 
        employees, principals, and assistant principals may form their 
        own organizations.  An employer shall extend exclusive 
        recognition to a representative of or an organization of 
        supervisory or confidential employees, or principals and 
        assistant principals, for the purpose of negotiating terms or 
        conditions of employment, in accordance with sections 179A.01 to 
        179A.25, applicable to essential employees.  
           Supervisory or confidential employee organizations shall 
        not participate in any capacity in any negotiations which 
        involve units of employees other than supervisory or 
        confidential employees.  Except for organizations which 
        represent supervisors who are:  (1) firefighters, emergency 
        medical service employees certified under section 144E.28, 911 
        system public safety dispatchers, peace officers subject to 
        licensure under sections 626.84 to 626.863, guards at 
        correctional facilities, or employees at hospitals other than 
        state hospitals; and (2) not state or University of Minnesota 
        employees, a supervisory or confidential employee organization 
        which is affiliated with another employee organization which is 
        the exclusive representative of nonsupervisory or 
        nonconfidential employees of the same public employer shall not 
        be certified, or act as, an exclusive representative for the 
        supervisory or confidential employees.  For the purpose of this 
        subdivision, affiliation means either direct or indirect and 
        includes affiliation through a federation or joint body of 
        employee organizations. 
           Sec. 5.  [179A.40] [HENNEPIN HEALTHCARE SYSTEM, INC.] 
           Subdivision 1.  [UNITS.] The following are the appropriate 
        employee units of the Hennepin Healthcare System, Inc.  All 
        units shall exclude supervisors, managerial employees, and 
        confidential employees.  No additional units of Hennepin 
        Healthcare System, Inc., shall be eligible to be certified for 
        the purpose of meeting and negotiating with an exclusive 
        representative.  The units include all: 
           (1) registered nurses; 
           (2) physicians; 
           (3) professionals except for registered nurses and 
        physicians; 
           (4) technical and paraprofessional employees; 
           (5) carpenters, electricians, painters, and plumbers; 
           (6) health general service employees; 
           (7) interpreters; 
           (8) emergency medical technicians/emergency medical 
        dispatchers (EMT/EMD), and paramedics; 
           (9) bioelectronics specialists, bioelectronics technicians, 
        and electronics technicians; 
           (10) skilled maintenance employees; and 
           (11) clerical employees. 
           Subd. 2.  [NONCONFORMING UNITS.] Preexisting Hennepin 
        County Medical Center bargaining units covered by existing labor 
        agreements on the day following final enactment of this act that 
        do not conform to one of the 11 units described in subdivision 1 
        shall continue to be appropriate.  If an employee representative 
        seeks to represent employees who are residual to an existing 
        nonconforming unit, then all of the employees who are residual 
        to that unit shall be eligible to vote in an election conducted 
        by the commissioner.  An election shall be held when an employee 
        organization or group of employees files a petition for an 
        election and the petition is supported by a showing of interest 
        from 30 percent or more of the employees who are residual to an 
        existing nonconforming unit.  The employees who are residual to 
        an existing nonconforming unit shall be included within the 
        existing nonconforming unit if a majority of the eligible 
        employees who vote cast their ballots in favor of representation 
        during an election conducted by the commissioner.  Nothing shall 
        preclude an exclusive representative and Hennepin Health Care 
        System, Inc., or prior to the formation of the corporation 
        Hennepin County, from agreeing to an election conducted by the 
        commissioner or other appropriate procedure by which less than 
        all of the employees who are residual to an existing 
        nonconforming unit may be added to the unit. 
           Sec. 6.  Minnesota Statutes 2004, section 383B.117, 
        subdivision 2, is amended to read: 
           Subd. 2.  [EQUIPMENT ACQUISITION; CAPITAL NOTES.] The board 
        may, by resolution and without public referendum, issue capital 
        notes within existing debt limits for the purpose of purchasing 
        ambulance and other medical equipment, road construction or 
        maintenance equipment, public safety equipment and other capital 
        equipment having an expected useful life at least equal to the 
        term of the notes issued.  The notes shall be payable in not 
        more than five years and shall be issued on terms and in a 
        manner as the board determines.  The total principal amount of 
        the notes issued for any fiscal year shall not exceed one 
        percent of the total annual budget for that year and shall be 
        issued solely for the purchases authorized in this subdivision.  
        A tax levy shall be made for the payment of the principal and 
        interest on such notes as in the case of bonds.  For purposes of 
        this subdivision, the term "medical equipment" includes computer 
        hardware and software and other intellectual property for use in 
        medical diagnosis, medical procedures, research, record keeping, 
        billing, and other hospital applications, together with 
        application development services and training related to the use 
        of the computer hardware and software and other intellectual 
        property, all without regard to their useful life.  For purposes 
        of determining the amount of capital notes which the county may 
        issue in any year, the budget of the county and Hennepin 
        Healthcare System, Inc. shall be combined and the notes issuable 
        under this subdivision shall be in addition to obligations 
        issuable under section 373.01, subdivision 3. 
           Sec. 7.  Minnesota Statutes 2004, section 383B.217, 
        subdivision 7, is amended to read: 
           Subd. 7.  [PURCHASES AND MARKETING PURCHASING, CONTRACTING, 
        MEETINGS, DATA.] (a) Contracting and purchasing made on behalf 
        of the Hennepin County Medical Center and its health maintenance 
        organization (HMO), ambulatory health center, or other clinics 
        authorized under section 383B.219, of goods, materials, 
        supplies, equipment, and services that are incidental to or that 
        are included as part of a contract for the purchase of goods, 
        materials, supplies, or equipment are specifically exempted from 
        sections 383B.141 to 383B.151 and 471.345 or other applicable 
        laws related to public procurement.  Contracting and purchasing 
        of services shall comply with sections 383B.141 to 383B.151 or 
        other applicable laws related to public procurement. 
           (b) Notwithstanding chapter 13D, the county board on behalf 
        of the medical center and HMO may meet in closed session to 
        discuss and take action on specific products or services that 
        are in direct competition with other providers of goods or 
        services in the public or private sector, if disclosure of 
        information pertaining to those matters would clearly harm the 
        competitive position of the medical center or HMO. 
           (c) The medical center and HMO shall inform the county 
        board when there are matters that are appropriate for discussion 
        or action under paragraph (b).  The county administrator or the 
        administrator's designee shall give the board an opinion on the 
        propriety of discussion or action under paragraph (b) for each 
        of the matters.  The county board may, by a majority vote in a 
        public meeting, decide to hold a closed meeting under paragraph 
        (b).  The purpose, time, and place of the meeting must be 
        announced at a public meeting.  A written roll of members 
        present at a closed meeting must be made available to the public 
        after the closed meeting.  The proceedings of a closed meeting 
        must be tape recorded at the expense of the county board and be 
        preserved for not less than five years after the meeting.  The 
        data on the tape are nonpublic data under section 13.02, 
        subdivision 9, until two years after the meeting.  A contract 
        entered into by the county board at a meeting held on behalf of 
        the medical center or HMO is subject to section 471.345.  All 
        bids and any related materials that are considered at the 
        meeting must be retained for a period of not less than five 
        years.  After the expiration of the term of any contract entered 
        into pursuant to this subdivision or a period of two years, 
        whichever is less, the contract, the bids, and any related 
        materials are public data.  The contract, the bids, and any 
        related materials are subject to review by the state auditor at 
        any time. 
           (d) Data concerning specific products or services that are 
        in direct competition with other providers of goods or services 
        in the public or private sector are trade secret information for 
        purposes of section 13.37, to the extent disclosure of 
        information pertaining to the matters would clearly harm the 
        competitive position of the medical center or HMO.  The data are 
        trade secret information for the term of the contract or a 
        two-year period, whichever is less.  
           (e) Notwithstanding section 471.345 or other applicable 
        law, the county board on behalf of the medical center, HMO, 
        ambulatory health center, or other clinics authorized under 
        section 383B.219, may contract, except for services, by any 
        means that the county board or at its direction the medical 
        center or HMO, ambulatory health center, or other clinics 
        authorized under section 383B.219, may determine.  When 
        contracting for services, the county board must comply with 
        sections 383B.141 to 383B.151 and other applicable law, except 
        that the board may contract with a private or public cooperative 
        purchasing organization if it can be established that the 
        purchasing organization's services that are purchased have been 
        awarded through a competitive or request for proposal process.  
           (f) This subdivision applies to the medical center, HMO, 
        ambulatory health centers, or other clinics authorized under 
        section 383B.219, as well as any other organization, 
        association, partnership, or corporation authorized by Hennepin 
        County under section 144.581. 
           Sec. 8.  [TRANSITION.] 
           Subdivision 1.  [INITIAL BOARD.] For the first three years, 
        the board of Hennepin Healthcare System, Inc., shall be governed 
        by a board of directors consisting of 13 directors appointed by 
        the county board according to the procedure specified in this 
        act. 
           Subd. 2.  [INITIAL HUMAN RESOURCES SYSTEM.] Input from 
        Hennepin County Medical Center employees shall be obtained prior 
        to the development of the human resources rules and policies for 
        the new corporation and the rules and policies shall be 
        finalized and the county board shall, by a single majority vote 
        without amendment, approve the rules and policies and ratify 
        labor agreements, prior to the county board's vote to file the 
        certificate of local approval. 
           Sec. 9.  [REPEALER.] 
           Minnesota Statutes 2004, section 383B.217, subdivisions 1, 
        2, 3, 4, 5, 6, and 8, are repealed. 
           Sec. 10.  [EFFECTIVE DATE.] 
           Sections 1 to 7 and 9 are effective on the date specified 
        in article 1, section 29, paragraph (b).  Section 8 is effective 
        the day following final enactment. 

                                   ARTICLE 3 
                         CONFORMING RETIREMENT CHANGES 
           Section 1.  Minnesota Statutes 2004, section 353.01, 
        subdivision 2b, is amended to read: 
           Subd. 2b.  [EXCLUDED EMPLOYEES.] The following public 
        employees are not eligible to participate as members of the 
        association with retirement coverage by the public employees 
        retirement plan, the local government correctional employees 
        retirement plan under chapter 353E, or the public employees 
        police and fire retirement plan: 
           (1) public officers, other than county sheriffs, who are 
        elected to a governing body, or persons who are appointed to 
        fill a vacancy in an elective office of a governing body, whose 
        term of office commences on or after July 1, 2002, for the 
        service to be rendered in that elective position.  Elected 
        governing body officials who were active members of the 
        association's coordinated or basic retirement plans as of June 
        30, 2002, continue participation throughout incumbency in office 
        until termination of public service occurs as defined in 
        subdivision 11a; 
           (2) election officers or election judges; 
           (3) patient and inmate personnel who perform services for a 
        governmental subdivision; 
           (4) except as otherwise specified in subdivision 12a, 
        employees who are hired for a temporary position as defined 
        under subdivision 12a, and employees who resign from a 
        nontemporary position and accept a temporary position within 30 
        days in the same governmental subdivision; 
           (5) employees who are employed by reason of work emergency 
        caused by fire, flood, storm, or similar disaster; 
           (6) employees who by virtue of their employment in one 
        governmental subdivision are required by law to be a member of 
        and to contribute to any of the plans or funds administered by 
        the Minnesota State Retirement System, the Teachers Retirement 
        Association, the Duluth Teachers Retirement Fund Association, 
        the Minneapolis Teachers Retirement Fund Association, the St. 
        Paul Teachers Retirement Fund Association, the Minneapolis 
        Employees Retirement Fund, or any police or firefighters relief 
        association governed by section 69.77 that has not consolidated 
        with the Public Employees Retirement Association, or any local 
        police or firefighters consolidation account who have not 
        elected the type of benefit coverage provided by the public 
        employees police and fire fund under sections 353A.01 to 
        353A.10, or any persons covered by section 353.665, subdivision 
        4, 5, or 6, who have not elected public employees police and 
        fire plan benefit coverage.  This clause must not be construed 
        to prevent a person from being a member of and contributing to 
        the Public Employees Retirement Association and also belonging 
        to and contributing to another public pension plan or fund for 
        other service occurring during the same period of time.  A 
        person who meets the definition of "public employee" in 
        subdivision 2 by virtue of other service occurring during the 
        same period of time becomes a member of the association unless 
        contributions are made to another public retirement fund on the 
        salary based on the other service or to the Teachers Retirement 
        Association by a teacher as defined in section 354.05, 
        subdivision 2; 
           (7) persons who are members of a religious order and are 
        excluded from coverage under the federal Old Age, Survivors, 
        Disability, and Health Insurance Program for the performance of 
        service as specified in United States Code, title 42, section 
        410(a)(8)(A), as amended through January 1, 1987, if no 
        irrevocable election of coverage has been made under section 
        3121(r) of the Internal Revenue Code of 1954, as amended; 
           (8) employees of a governmental subdivision who have not 
        reached the age of 23 and are enrolled on a full-time basis to 
        attend or are attending classes on a full-time basis at an 
        accredited school, college, or university in an undergraduate, 
        graduate, or professional-technical program, or a public or 
        charter high school; 
           (9) resident physicians, medical interns, and pharmacist 
        residents and pharmacist interns who are serving in a degree or 
        residency program in public hospitals; 
           (10) students who are serving in an internship or residency 
        program sponsored by an accredited educational institution; 
           (11) persons who hold a part-time adult supplementary 
        technical college license who render part-time teaching service 
        in a technical college; 
           (12) except for employees of Hennepin County or Hennepin 
        Healthcare System, Inc., foreign citizens working for a 
        governmental subdivision with a work permit of less than three 
        years, or an H-1b visa valid for less than three years of 
        employment.  Upon notice to the association that the work permit 
        or visa extends beyond the three-year period, the foreign 
        citizens must be reported for membership from the date of the 
        extension; 
           (13) public hospital employees who elected not to 
        participate as members of the association before 1972 and who 
        did not elect to participate from July 1, 1988, to October 1, 
        1988; 
           (14) except as provided in section 353.86, volunteer 
        ambulance service personnel, as defined in subdivision 35, but 
        persons who serve as volunteer ambulance service personnel may 
        still qualify as public employees under subdivision 2 and may be 
        members of the Public Employees Retirement Association and 
        participants in the public employees retirement fund or the 
        public employees police and fire fund, whichever applies, on the 
        basis of compensation received from public employment service 
        other than service as volunteer ambulance service personnel; 
           (15) except as provided in section 353.87, volunteer 
        firefighters, as defined in subdivision 36, engaging in 
        activities undertaken as part of volunteer firefighter duties; 
        provided that a person who is a volunteer firefighter may still 
        qualify as a public employee under subdivision 2 and may be a 
        member of the Public Employees Retirement Association and a 
        participant in the public employees retirement fund or the 
        public employees police and fire fund, whichever applies, on the 
        basis of compensation received from public employment activities 
        other than those as a volunteer firefighter; 
           (16) pipefitters and associated trades personnel employed 
        by Independent School District No. 625, St. Paul, with coverage 
        under a collective bargaining agreement by the pipefitters local 
        455 pension plan who were either first employed after May 1, 
        1997, or, if first employed before May 2, 1997, elected to be 
        excluded under Laws 1997, chapter 241, article 2, section 12; 
           (17) electrical workers, plumbers, carpenters, and 
        associated trades personnel employed by Independent School 
        District No. 625, St. Paul, or the city of St. Paul, who have 
        retirement coverage under a collective bargaining agreement by 
        the Electrical Workers Local 110 pension plan, the United 
        Association Plumbers Local 34 pension plan, or the Carpenters 
        Local 87 pension plan who were either first employed after May 
        1, 2000, or, if first employed before May 2, 2000, elected to be 
        excluded under Laws 2000, chapter 461, article 7, section 5; 
           (18) bricklayers, allied craftworkers, cement masons, 
        glaziers, glassworkers, painters, allied tradesworkers, and 
        plasterers employed by the city of St. Paul or Independent 
        School District No. 625, St. Paul, with coverage under a 
        collective bargaining agreement by the Bricklayers and Allied 
        Craftworkers Local 1 pension plan, the Cement Masons Local 633 
        pension plan, the Glaziers and Glassworkers Local L-1324 pension 
        plan, the Painters and Allied Trades Local 61 pension plan, or 
        the Twin Cities Plasterers Local 265 pension plan who were 
        either first employed after May 1, 2001, or if first employed 
        before May 2, 2001, elected to be excluded under Laws 2001, 
        First Special Session chapter 10, article 10, section 6; 
           (19) plumbers employed by the Metropolitan Airports 
        Commission, with coverage under a collective bargaining 
        agreement by the Plumbers Local 34 pension plan, who either were 
        first employed after May 1, 2001, or if first employed before 
        May 2, 2001, elected to be excluded under Laws 2001, First 
        Special Session chapter 10, article 10, section 6; 
           (20) employees who are hired after June 30, 2002, to fill 
        seasonal positions under subdivision 12b which are limited in 
        duration by the employer to 185 consecutive calendar days or 
        less in each year of employment with the governmental 
        subdivision; 
           (21) persons who are provided supported employment or 
        work-study positions by a governmental subdivision and who 
        participate in an employment or industries program maintained 
        for the benefit of these persons where the governmental 
        subdivision limits the position's duration to three years or 
        less, including persons participating in a federal or state 
        subsidized on-the-job training, work experience, senior citizen, 
        youth, or unemployment relief program where the training or work 
        experience is not provided as a part of, or for, future 
        permanent public employment; 
           (22) independent contractors and the employees of 
        independent contractors; and 
           (23) reemployed annuitants of the association during the 
        course of that reemployment. 
           Sec. 2.  Minnesota Statutes 2004, section 353.01, 
        subdivision 2d, is amended to read: 
           Subd. 2d.  [OPTIONAL MEMBERSHIP.] (a) Membership in the 
        association is optional by action of the individual employee for 
        the following public employees who meet the conditions set forth 
        in subdivision 2a: 
           (1) members of the coordinated plan who are also employees 
        of labor organizations as defined in section 353.017, 
        subdivision 1, for their employment by the labor organization 
        only if they elect to have membership under section 353.017, 
        subdivision 2; 
           (2) persons who are elected or persons who are appointed to 
        elected positions other than local governing body elected 
        positions who elect to participate by filing a written election 
        for membership; 
           (3) members of the association who are appointed by the 
        governor to be a state department head and who elect not to be 
        covered by the general state employees retirement plan of the 
        Minnesota State Retirement System under section 352.021; 
           (4) city managers as defined in section 353.028, 
        subdivision 1, who do not elect to be excluded from membership 
        in the association under section 353.028, subdivision 2; and 
           (5) employees of the Port Authority of the city of St. Paul 
        who were at least age 45 on January 1, 2003, and who elect to 
        participate by filing a written election for membership. 
           (b) Membership in the association is optional by action of 
        the governmental subdivision for the employees of the following 
        governmental subdivisions under the conditions specified: 
           (1) the Minnesota Association of Townships if the board of 
        the association, at its option, certifies to the executive 
        director that its employees are to be included for purposes of 
        retirement coverage, in which case the status of the association 
        as a participating employer is permanent; and 
           (2) a county historical society if the county in which the 
        historical society is located, at its option, certifies to the 
        executive director that the employees of the historical society 
        are to be county employees for purposes of retirement coverage 
        under this chapter.  The status as a county employee must be 
        accorded to all similarly situated county historical society 
        employees and, once established, must continue as long as a 
        person is an employee of the county historical society; and 
           (3) Hennepin Healthcare System, Inc., a public corporation, 
        with respect to employees other than paramedics, emergency 
        medical technicians, and protection officers, if the corporate 
        board establishes alternative retirement plans for certain 
        classes of employees of the corporation and certifies the 
        employees to be excluded from future retirement coverage. 
           (c) For employees who are covered by paragraph (a), clause 
        (1), (2), or (3), or covered by paragraph (b), clause (1) or 
        (2), if the necessary membership election is not made, the 
        employee is excluded from retirement coverage under this 
        chapter.  For employees who are covered by paragraph (a), clause 
        (4), if the necessary election is not made, the employee must 
        become a member and have retirement coverage under this 
        chapter.  For employees specified in paragraph (b), clause (3), 
        membership continues until the exclusion option is exercised for 
        the designated class of employee.  The option to become a 
        member, once exercised under this subdivision, may not be 
        withdrawn until termination of public service as defined under 
        subdivision 11a. 
           Sec. 3.  Minnesota Statutes 2004, section 353.01, 
        subdivision 6, is amended to read: 
           Subd. 6.  [GOVERNMENTAL SUBDIVISION.] (a) "Governmental 
        subdivision" means a county, city, town, school district within 
        this state, or a department or unit of state government, or any 
        public body whose revenues are derived from taxation, fees, 
        assessments or from other sources. 
           (b) Governmental subdivision also means the Public 
        Employees Retirement Association, the League of Minnesota 
        Cities, the Association of Metropolitan Municipalities, public 
        hospitals owned or operated by, or an integral part of, a 
        governmental subdivision or governmental subdivisions, the 
        Association of Minnesota Counties, the Metropolitan Intercounty 
        Association, the Minnesota Municipal Utilities Association, the 
        Metropolitan Airports Commission, the Minneapolis Employees 
        Retirement Fund for employment initially commenced after June 
        30, 1979, the Range Association of Municipalities and Schools, 
        soil and water conservation districts, economic development 
        authorities created or operating under sections 469.090 to 
        469.108, the Port Authority of the city of St. Paul, the Spring 
        Lake Park Fire Department, incorporated, the Lake Johanna 
        Volunteer Fire Department, incorporated, the Red Wing 
        Environmental Learning Center, and the Dakota County 
        Agricultural Society, and Hennepin Healthcare System, Inc. 
           (c) Governmental subdivision does not mean any municipal 
        housing and redevelopment authority organized under the 
        provisions of sections 469.001 to 469.047; or any port authority 
        organized under sections 469.048 to 469.089 other than the Port 
        Authority of the city of St. Paul; or any hospital district 
        organized or reorganized prior to July 1, 1975, under sections 
        447.31 to 447.37 or the successor of the district, nor the 
        Minneapolis Community Development Agency.  
           Sec. 4.  Minnesota Statutes 2004, section 353.64, 
        subdivision 10, is amended to read: 
           Subd. 10.  [PENSION COVERAGE FOR HENNEPIN COUNTY HEALTHCARE 
        SYSTEM, INC.; PARAMEDICS AND EMERGENCY MEDICAL TECHNICIANS.] An 
        employee of Hennepin County Healthcare System, Inc. who is: 
           (1) certified as a paramedic or emergency medical 
        technician by the state under section 144E.28, subdivision 4; 
           (2) employed full time as a paramedic or emergency medical 
        technician by Hennepin County on or after the effective date 
        specified in Laws 1994, chapter 499, section 2; and 
           (3) not eligible after the effective date under Laws 1994, 
        chapter 499, section 2, for coverage under the agreement signed 
        between the state and the secretary of the federal Department of 
        Health and Human Services making the provisions of the federal 
        Old Age, Survivors, and Disability Insurance Act applicable to 
        paramedics and emergency medical technicians because the 
        person's position is excluded after that date from application 
        under United States Code, title 42, sections 418(d)(5)(A) and 
        418(d)(8)(D), and section 355.07; 
        is a member of the public employees police and fire fund under 
        sections 353.63 to 353.68.  
           Hennepin County Healthcare System, Inc. shall deduct the 
        employee contribution from the salary of each full-time Hennepin 
        County paramedic and emergency medical technician it employs as 
        required by section 353.65, subdivision 2, shall make the 
        employer contribution for each full-time Hennepin County 
        paramedic and emergency medical technician it employs as 
        required by section 353.65, subdivision 3, and shall meet the 
        employer recording and reporting requirements in section 353.65, 
        subdivision 4. 
           Sec. 5.  Minnesota Statutes 2004, section 353E.02, 
        subdivision 2a, is amended to read: 
           Subd. 2a.  [MEDICAL CENTER PROTECTION OFFICER.] (a) A 
        medical center protection officer, for purposes of subdivision 
        1, is a person whom the employer certifies: 
           (1) is employed by the Hennepin County Medical Center 
        Healthcare System, Inc. as a protection officer; 
           (2) is directly responsible for the direct security of the 
        medical center; 
           (3) is expected to respond to any incidents within the 
        medical center as part of the person's regular employment duties 
        and is trained to do so; and 
           (4) is a "public employee" as defined in section 353.01, 
        but is not a member of the public employees police and fire plan.
           (b) The certification required under paragraph (a) must be 
        made in writing on a form prescribed by the executive director 
        of the Public Employees Retirement Association. 
           Sec. 6.  Minnesota Statutes 2004, section 383B.46, is 
        amended to read: 
           383B.46 [SUPPLEMENTAL RETIREMENT ACCOUNT.] 
           Subdivision 1.  [ELIGIBILITY FOR COVERAGE.] Any person who 
        was employed by the county of Hennepin or its agencies, boards, 
        commissions, authorities and committees prior to before April 
        14, 1982, as an employee or an officer in the classified service 
        as defined in sections 383B.26 to 383B.42, or as an employee in 
        the unclassified service, and who has served for five years as a 
        county employee or an officer in the classified service, or as a 
        county employee in the unclassified service, which need not 
        necessarily be continuous, and which shall must include time 
        served as a county employee prior to before June 8, 1965, if the 
        person is an employee in the classified service, shall be of the 
        county or if the person is an employee of Hennepin Healthcare 
        System, Inc., is entitled to elect to obtain coverage by the 
        Hennepin County supplemental retirement program.  The election 
        to obtain coverage may be exercised only once and shall must be 
        exercised within 30 days of the date on which the person first 
        becomes entitled to elect to obtain coverage.  No person hired, 
        rehired, or reinstated by the county as an employee in the 
        classified or unclassified service on or after April 14, 
        1982, shall be is eligible for coverage by the Hennepin County 
        supplemental retirement program.  
           Subd. 2.  [ESTABLISHMENT OF ACCOUNT; CONTRIBUTIONS.] The 
        county of Hennepin or Hennepin Healthcare System, Inc., 
        whichever applies, shall deduct from the salary of every person 
        who is eligible for coverage and who elected to retain or obtain 
        coverage by the Hennepin County supplemental retirement program 
        a sum equal to one percent of the total salary of the 
        person.  Any classified or unclassified employee who is employed 
        in subsidized on-the-job training, work experience or public 
        service employment as an enrollee under the federal 
        Comprehensive Employment and Training Act shall not be included 
        in the supplemental retirement account from and after March 30, 
        1978 unless the employee has as of the later of March 30, 1978 
        or the date of employment sufficient service credit in the 
        public employees retirement fund or the Minneapolis municipal 
        employees retirement fund, whichever is applicable, to meet the 
        minimum vesting requirements for a deferred retirement annuity, 
        or the county agrees in writing to make the required employer 
        contributions on account of the individual from revenue sources 
        other than funds provided under the federal Comprehensive 
        Employment and Training Act, or the employee agrees in writing 
        to make the required employer contribution in addition to the 
        employee contribution.  The deduction shall be made in the same 
        manner as other retirement deductions are made from the salary 
        of the person.  An amount equal to the amounts deducted during 
        each payroll period shall must be contributed by the county of 
        Hennepin or Hennepin Healthcare System, Inc., whichever 
        applies.  The total amount deducted and contributed shall must 
        be deposited to the credit of the supplemental retirement 
        account in the treasury of the county of Hennepin.  The Hennepin 
        County supplemental retirement account is hereby established as 
        an account separate and distinct from other funds, accounts, or 
        assets of the county of Hennepin. 
           Sec. 7.  [EFFECTIVE DATE.] 
           Sections 1 to 6 are effective on the date specified in 
        article 1, section 29, paragraph (b). 
           Presented to the governor May 31, 2005 
           Signed by the governor June 2, 2005, 5:40 p.m.