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                            CHAPTER 183-S.F.No. 1888 
                  An act relating to education; appropriating money for 
                  education and related purposes to the higher education 
                  services office, board of trustees of the Minnesota 
                  state colleges and universities, board of regents of 
                  the University of Minnesota, and the Mayo medical 
                  foundation, with certain conditions; establishing and 
                  modifying programs that promote college affordability; 
                  providing for agriculture education; clarifying the 
                  role of the higher education services office; making 
                  technical changes related to the post-secondary 
                  merger; increasing the higher education facilities 
                  authority bonding authority; modifying certain 
                  conditions for the Minnesota state colleges and 
                  universities; prescribing uses for the permanent 
                  university fund; extending the repeal of the 
                  farmer-lender mediation act; permitting certain land 
                  conveyances; placing a condition on referenda by 
                  campus student associations; establishing the 
                  Minnesota Virtual University, a roundtable on 
                  vocational technical education, and an agriculture 
                  education leadership council; amending Minnesota 
                  Statutes 1996, sections 16A.69, subdivision 2; 
                  125.1385, subdivision 2; 126.56, subdivisions 2, 4a, 
                  and 7; 135A.052, subdivision 1; 136A.03; 136A.101, by 
                  adding a subdivision; 136A.121, subdivisions 5 and 9a; 
                  136A.125, subdivision 4; 136A.1355; 136A.136, 
                  subdivision 2; 136A.16, subdivision 8, and by adding 
                  subdivisions; 136A.171; 136A.173, subdivision 3; 
                  136A.233, subdivisions 2, 3, and by adding a 
                  subdivision; 136A.29, subdivision 9; 136F.28, 
                  subdivision 2; 136F.32; 136F.49; 136F.581, subdivision 
                  2; 136F.72, subdivision 1; 136F.80; 137.022, 
                  subdivision 2; 181.06, subdivision 2; 216C.27, 
                  subdivision 7; and 583.22, subdivision 5; Laws 1986, 
                  chapter 398, article 1, section 18, as amended; Laws 
                  1994, chapter 643, section 19, subdivision 9, as 
                  amended; Laws 1996, chapter 366, section 6; and Laws 
                  1997, chapter 32, by adding a section; proposing 
                  coding for new law in Minnesota Statutes, chapters 
                  16A; 136A; and 136F; proposing coding for new law as 
                  Minnesota Statutes, chapter 41D; repealing Minnesota 
                  Statutes 1996, sections 126.113 and 137.41; Laws 1995, 
                  chapter 212, article 4, section 34; and Laws 1995, 
                  First Special Session chapter 2, article 1, sections 
                  35 and 36. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
                                   ARTICLE 1 
                                 APPROPRIATIONS
        Section 1.  [HIGHER EDUCATION APPROPRIATIONS.] 
           The sums in the columns marked "APPROPRIATIONS" are 
        appropriated from the general fund, or other named fund, to the 
        agencies and for the purposes specified in this article.  The 
        listing of an amount under the figure "1998" or "1999" in this 
        article indicates that the amount is appropriated to be 
        available for the fiscal year ending June 30, 1998, or June 30, 
        1999, respectively.  "The first year" is fiscal year 1998.  "The 
        second year" is fiscal year 1999.  "The biennium" is fiscal 
        years 1998 and 1999. 
                                SUMMARY BY FUND
                                  1998          1999           TOTAL
        General            $1,180,479,000 $1,191,244,000 $2,371,723,000
                         SUMMARY BY AGENCY - ALL FUNDS
                                  1998          1999           TOTAL
        Higher Education Services Office
                              136,806,000    140,802,000    277,608,000
        Board of Trustees of the Minnesota
        State Colleges and Universities
                              501,682,000    513,954,000  1,015,636,000
        Board of Regents of the University
        of Minnesota
                              540,842,000    535,206,000  1,076,048,000
        Mayo Medical Foundation
                                1,149,000      1,282,000      2,431,000
                                                   APPROPRIATIONS 
                                               Available for the Year 
                                                   Ending June 30 
                                                  1998         1999 
        Sec. 2.  HIGHER EDUCATION
        SERVICES OFFICE
        Subdivision 1.  Total
        Appropriation                        136,806,000    140,802,000
        The amounts that may be spent from this 
        appropriation for each purpose are 
        specified in the following subdivisions.
        Subd. 2.  State Grants
             99,046,000       115,171,000
        If the appropriation in this 
        subdivision for either year is 
        insufficient, the appropriation for the 
        other year is available for it.  
        The legislature intends that the higher 
        education services office make full 
        grant awards in each year of the 
        biennium.  
        For the biennium, the private 
        institution tuition maximum shall be 
        $7,860 in the first year and $8,055 in 
        the second year for four-year 
        institutions and $6,050 in the first 
        year and $6,200 in the second year for 
        two-year institutions. 
        This appropriation contains money to 
        set the living and miscellaneous 
        expense allowance at $4,500 in the 
        first year and $4,885 in the second 
        year. 
        This appropriation includes $250,000 
        each year for grants to nursing 
        programs to recruit persons of color 
        and to provide grants to nursing 
        students who are persons of color.  Of 
        this amount, $100,000 each year is for 
        recruitment and retention of students 
        of color in nursing programs leading to 
        licensure as a registered nurse.  Other 
        than the grants to students, all grants 
        shall be matched with at least the same 
        amount from grantee sources or nonstate 
        money.  
        $50,000 in each year is for the loan 
        repayment assistance program of 
        Minnesota to reimburse graduates of 
        Minnesota law schools working as 
        lawyers in Minnesota who meet the 
        eligibility criteria for loan repayment 
        for law school debt.  The eligibility 
        criteria must include the following:  
        (1) recipient's annual household income 
        is $30,000 or less; and (2) recipient 
        is providing legal services full time 
        for economically disadvantaged persons 
        for (a) a nonprofit agency as defined 
        by section 501(c)(3), 501(c)(4), or 
        501(c)(5) of the Internal Revenue Code 
        of 1986; (b) Native American tribal 
        governments, court systems, and public 
        interest organizations; (c) public 
        defense corporations; or (d) the state 
        board of public defense.  The money may 
        be released to the program only in 
        amounts that have been matched dollar 
        for dollar with private money.* (The 
        preceding text beginning "$50,000" was 
        vetoed by the governor.) 
        This appropriation contains money for 
        the National Service Scholars program. 
        Subd. 3.  Interstate Tuition
        Reciprocity
             4,000,000      4,000,000
        If the appropriation in this 
        subdivision for either year is 
        insufficient, the appropriation for the 
        other year is available to meet 
        reciprocity contract obligations. 
        The higher education services office is 
        authorized to negotiate a reciprocity 
        agreement with the province of Ontario. 
        Subd. 4.  State Work Study
             9,444,000      9,444,000
        Subd. 5.  Minitex Library Program
             2,608,000      2,608,000
        This appropriation contains money for 
        online access to science and technology 
        periodicals. 
        Subd. 6.  Learning Network of Minnesota
             5,500,000      5,292,000
        Up to $1,500,000 of this amount is to 
        assist in establishing a gigabit 
        capacity point of presence at the 
        University of Minnesota-Twin Cities and 
        to support the University's 
        participation in the national Internet 
        two initiative for research and 
        development of telecommunications 
        networks.  This appropriation is 
        available to the extent matched by the 
        University of Minnesota or private 
        sources. 
        This appropriation includes money for 
        quality improvements and inter-region 
        and interstate connectivity for MnNet. 
        Subd. 7.  Income Contingent Loans
        The higher education services office 
        shall administer an income contingent 
        loan repayment program to assist 
        graduates of Minnesota schools in 
        medicine, dentistry, pharmacy, 
        chiropractic medicine, public health, 
        and veterinary medicine, and Minnesota 
        residents graduating from optometry and 
        osteopathy programs.  Applicant data 
        collected by the higher education 
        services office for this program may be 
        disclosed to a consumer credit 
        reporting agency under the same 
        conditions as apply to the supplemental 
        loan program under Minnesota Statutes, 
        section 136A.162.  No new applicants 
        may be accepted after June 30, 1995. 
        Subd. 8.  Minnesota Library
        Information Network
            12,000,000          -0-         
        This appropriation is for 
        implementation of the Minnesota library 
        information network, which shall be 
        developed in cooperation with the 
        library planning task force, and shall 
        include:  (1) an integrated library 
        system that will serve the libraries of 
        the University of Minnesota; the 
        Minnesota state colleges and 
        universities system; state government; 
        interested public, school, and private 
        college libraries; and not-for-profit 
        institutions that meet the 
        requirements; and (2) a common services 
        gateway creating links to the 
        integrated library system for 
        compatible school, public, and 
        not-for-profit library information 
        systems statewide.  Staff needed for 
        training and user support, technical 
        support, installation, and operation of 
        the network shall be obtained from the 
        Minnesota state colleges and 
        universities system, the University of 
        Minnesota, and other entities that have 
        experience and expertise in operating a 
        large library automation system.  This 
        appropriation is available until 
        expended or until the network is 
        completed, whichever occurs first. 
        Subd. 9.  Edvest 
             1,519,000      1,520,000 
        Subd. 10.  Agency Administration
             2,689,000      2,767,000
        This appropriation includes money for 
        the Minnesota Minority Education 
        Partnership. 
        Money encumbered for youth works 
        postservice benefits shall not cancel 
        but is available until the participants 
        for whom the money was encumbered are 
        no longer eligible to draw benefits. 
        The higher education advisory council 
        and the student advisory council shall 
        not expire on June 30, 1997, but shall 
        continue for the biennium. 
        Subd. 11.  Balances Forward 
        An unencumbered balance in the first 
        year under a subdivision in this 
        section does not cancel but is 
        available for the second year. 
        Subd. 12.  Transfers 
        The higher education services office 
        may transfer unencumbered balances from 
        the appropriations in this section to 
        the state grant appropriation, the 
        interstate tuition reciprocity 
        appropriation, the child care 
        appropriation, and the state work study 
        appropriation. 
        The higher education services office 
        shall make recommendations to the 1998 
        and 1999 legislatures on how to use any 
        savings resulting from federal Pell 
        grant changes.  Options for the office 
        to consider shall include, but not be 
        limited to, reducing the assigned 
        family responsibility for independent 
        students and reducing the student share 
        in the state grant formula. 
        Subd. 13.  Nonrecurring Appropriations 
        The appropriations for the Minnesota 
        library information network, quality 
        improvements on MnNet, inter-region and 
        interstate connectivity for MnNet, and 
        the National Service Scholars program 
        are nonrecurring. 
        Sec. 3.  BOARD OF TRUSTEES OF THE
        MINNESOTA STATE COLLEGES AND UNIVERSITIES
        Subdivision 1.  Total
        Appropriation                       501,682,000    513,954,000
        The amounts that may be spent from this 
        appropriation for each purpose are 
        specified in the following subdivisions.
        In fiscal year 1998, each college and 
        university is to receive its fiscal 
        year 1997 state appropriation adjusted 
        for enrollment changes.  In addition, 
        instructional and noninstructional 
        appropriation increases for educational 
        improvements, performance, technology, 
        equipment, and the electronic academy 
        are to be distributed to the colleges 
        and universities based on a weighted 
        average as follows: 
        (1) each campus's proportion of the 
        fiscal year 1997 state appropriation, 
        weighted at 70 percent; and 
        (2) the proportion of each campus to 
        the total system full-year equivalent 
        enrollment for the 1996-1997 academic 
        year, weighted at 30 percent. 
        The system shall report to the 
        legislature on the board's progress in 
        developing a new allocation model by 
        February 1, 1998. 
        Subd. 2.  Instructional Expenditures 
        The legislature estimates that 
        instructional expenditures will be 
        $650,469,000 in the first year and 
        $664,765,000 in the second year. 
        During the biennium neither the board 
        nor campuses shall plan or develop 
        doctoral level programs or degrees 
        until after they have received the 
        recommendation of the house and senate 
        committees on education, finance, and 
        ways and means. 
        This appropriation contains money for 
        educational enhancements including 
        improvements in programs, student 
        services, advising, library 
        acquisitions, and class size and 
        availability, while holding down 
        tuition increases.  
        This appropriation contains money for 
        further development of the electronic 
        academy, including delivery of academic 
        programs statewide via electronic 
        technology, development of multimedia 
        instructional technology across the 
        curriculum, development of automated 
        student services available online and 
        through the Internet, provision of 
        technological services for staff and 
        students, staff development, and 
        challenge grants for innovative 
        technology applications.  Up to 
        $300,000 each year is for central 
        office costs associated with the 
        implementation of the electronic 
        academy. 
        This appropriation includes money for 
        improvements in instructional 
        technology and equipment to be used for 
        the benefit of faculty and students on 
        campus. 
        This appropriation contains money to 
        develop and implement a common student 
        information system and central data 
        management system, and to upgrade the 
        management information systems network. 
        During the biennium, each college and 
        university shall demonstrate to the 
        board that, in the face of budget 
        constraints, it has identified those 
        programs and functions that are central 
        to the mission of that campus and are 
        most critical to meeting student needs, 
        and that the campus has redirected 
        resources to those identified areas to 
        protect the core educational 
        enterprise.  Further, each campus shall 
        demonstrate that it has taken actions 
        to improve the productivity of faculty, 
        administrators, and staff. 
        During the biennium, technical and 
        consolidated colleges shall make use of 
        instructional advisory committees 
        consisting of employers, students, and 
        instructors.  The instructional 
        advisory committee shall be consulted 
        when a technical program is proposed to 
        be created, modified, or eliminated.  
        If a decision is made to eliminate a 
        program, a college shall adequately 
        notify students and make plans to 
        assist students affected by the closure.
        In each year the board of trustees 
        shall increase the percentage of the 
        total general fund expenditures for 
        direct instruction, as reported in the 
        federal Integrated Postsecondary 
        Education Data System (IPEDS).  By 
        February 15 of 1998 and 1999, the board 
        of trustees shall report to the 
        legislature the percentage of total 
        general fund expenditures spent on 
        direct instruction and on 
        administrative support during the 
        previous fiscal year. 
        In the process of converting to 
        semesters, the system and campuses 
        shall develop and incorporate 
        mechanisms to improve credit transfer 
        as they redesign curriculum. 
        This appropriation contains money for 
        the Virtual University. 
        Subd. 3.  Noninstructional Expenditures 
        The legislature estimates that 
        noninstructional expenditures will be 
        $45,765,000 in the first year and 
        $43,741,000 in the second year. 
        This appropriation contains money to 
        reimburse campuses for snow and flood 
        disasters.  
        This appropriation contains money to 
        pay the first year's assessments for 
        the road and entrance improvements at 
        Inver Hills Community College.  It is 
        anticipated that the remainder of the 
        costs will be paid from bond sources. 
        This appropriation contains money for 
        development and implementation of the 
        Minnesota career and education planning 
        system in partnership with the 
        University of Minnesota, the department 
        of children, families, and learning, 
        and the Minnesota office of 
        technology.  System maintenance and 
        operation costs must be paid by 
        participating agencies and institutions.
        $204,000 in the first year and $99,000 
        in the second year are for debt service 
        payments. 
        $150,000 each year is for southwest 
        Asia veterans tuition relief.  
        $150,000 in the first year is to 
        establish pilot programs at one 
        community college, one technical 
        college, and one consolidated community 
        technical college to expand the child 
        care offerings on campus to include 
        infant care.  To be chosen by the board 
        to receive a grant, a campus must 
        demonstrate that (1) it has an 
        exemplary child care program, (2) there 
        is demand for infant care on campus, 
        and (3) it has the physical and 
        financial capacity to sustain an infant 
        care program after the pilot grant has 
        expired.  The board shall provide an 
        evaluation of the pilot programs and 
        its recommendations on expanding infant 
        care to other campuses to the education 
        committees of the legislature as part 
        of its 2000-2001 biennial budget 
        request. 
        Subd. 4.  State Council on 
        Vocational Technical Education 
        The appropriation in subdivision 1 
        includes money in the first year for 
        the state council on vocational 
        education. 
        Subd. 5.  Nonrecurring Appropriations 
        The appropriations for the information 
        management system, technology, 
        equipment, the Virtual University, the 
        Minnesota career and education planning 
        system, building repairs and 
        betterment, snow and flood disaster, 
        state council on vocational education, 
        Inver Hills Community College road 
        assessment, and the infant care pilot 
        project are nonrecurring. 
        Sec. 4.  BOARD OF REGENTS OF THE 
        UNIVERSITY OF MINNESOTA 
        Subdivision 1.  Total
        Appropriation                        540,842,000    535,206,000
        The amounts that may be spent from this 
        appropriation for each purpose are 
        specified in the following subdivisions.
        Subd. 2.  Operations and
        Maintenance                          470,998,000    468,362,000
        (a) Instructional Expenditures 
        The legislature estimates that 
        instructional expenditures will be 
        $420,752,000 in the first year and 
        $423,096,000 in the second year. 
        This appropriation includes money for 
        the Virtual University. 
        This appropriation includes money for 
        programmatic improvements. 
        (b) Noninstructional Expenditures 
        The legislature estimates that 
        noninstructional expenditures will be 
        $182,073,000 in the first year and 
        $178,649,000 in the second year.  
        This appropriation contains money for 
        the development and implementation of 
        the Minnesota career and education 
        planning system in partnership with the 
        Minnesota state colleges and 
        universities, the department of 
        children, families, and learning, and 
        the Minnesota office of technology.  
        System maintenance and operation costs 
        must be paid by participating agencies 
        and institutions. 
        $3,000,000 in the first year is to 
        supplement the appropriation under Laws 
        1996, chapter 463, section 14, 
        subdivision 7, for the Mariucci ice and 
        tennis facility.  The facility shall be 
        a multisheet ice arena, unless the 
        board of regents determines, after 
        consultation with the Minnesota amateur 
        sports commission, that construction of 
        a multisheet ice arena is not feasible. 
        Any net profits from the operation of 
        the facility must go to the women's 
        athletic department. 
        $250,000 in the first year is for the 
        academic health center to provide 
        research grants of up to $20,000 to 
        faculty.  These grants shall be given 
        to provide developmental support for 
        projects that have a strong potential 
        for future funding from outside sources.
        By February 15 of each year, the 
        University shall report to the higher 
        education divisions of the legislature 
        on its efforts to improve opportunities 
        for female athletes consistent with 
        Title IX. 
        This appropriation contains money for 
        the violence and abuse prevention 
        program.  The legislature intends this 
        to be the final state appropriation.  
        Future financing must be from nonstate 
        sources. 
        Subd. 3.  Special
        Appropriation                         69,844,000     66,844,000
        The amounts expended for each program 
        in the four categories of special 
        appropriations shall be separately 
        identified in the 1999 biennial budget 
        document. 
        (a) Agriculture and Extension Service 
            51,047,000     51,047,000
        This appropriation is for the 
        Agricultural Experiment Station, 
        Minnesota Extension Service, and for 
        initiatives designed to sustain 
        Minnesota's renewable natural 
        resource-based industries, including, 
        but not limited to, regional 
        sustainable agriculture partnerships, 
        research on wheat and barley scab, 
        spring wheat, grapes and wine, and 
        canola. 
        Any salary increases granted by the 
        university to personnel paid from the 
        Minnesota Extension appropriation must 
        not result in a reduction of the county 
        portion of the salary payments. 
        During the biennium, the university 
        shall maintain an advisory council 
        system for each experiment station.  
        The advisory councils must be broadly 
        representative of range of size and 
        income distribution of farms and 
        agribusinesses and must not 
        disproportionately represent those from 
        the upper half of the size and income 
        distributions. 
        This appropriation contains money for 
        agriculture education including money 
        for the Minnesota agriculture 
        leadership council and for grants.  It 
        also includes money for the university 
        to improve recruitment and 
        collaborative efforts at the college of 
        agriculture, food, and environmental 
        science.  
        (b) Health Sciences 
            10,066,000      7,066,000
        This appropriation is for indigent 
        patients (county papers), rural 
        physicians associates program, the 
        Veterinary Diagnostic Laboratory, 
        health sciences research, dental care, 
        and the Biomedical Engineering Center. 
        By January 15, 1998, the board of 
        regents, after consultation with the 
        board of animal health, the livestock 
        industry, and the Minnesota Veterinary 
        Medical Association, is requested to 
        make recommendations to the higher 
        education finance divisions of the 
        legislature regarding transfer of 
        funding for the Veterinary Diagnostic 
        Laboratory to the board of animal 
        health. 
        This appropriation contains money for 
        technology transfer, research and 
        public service, and the Biomedical 
        Engineering Center endowment.  
        (c) Institute of Technology  
             1,552,000      1,552,000
        This appropriation is for the 
        Geological Survey and the Talented 
        Youth Mathematics Program. 
        (d) System Specials 
             7,179,000      7,179,000
        This appropriation is for general 
        research, student loans matching money, 
        industrial relations education, Natural 
        Resources Research Institute, Center 
        for Urban and Regional Affairs, Bell 
        Museum of Natural History, and the 
        Humphrey exhibit.  For the biennium, 
        the board shall not reduce the total 
        allocation for industrial relations 
        education. 
        Subd. 4.  Nonrecurring Appropriations 
        The appropriations for the 
        administrative process redesign, the 
        Virtual University, the Minnesota 
        career and education planning system, 
        the Biomedical Engineering Center 
        endowment, technology transfer, women's 
        ice sheet and tennis facility, violence 
        and abuse prevention program, and 
        programmatic improvements and 
        performance are nonrecurring. 
        Sec. 5.  MAYO MEDICAL FOUNDATION 
        Subdivision 1.  Total
        Appropriation                           1,149,000       1,282,000
        The amounts that may be spent from this 
        appropriation for each purpose are 
        specified in the following subdivisions.
        Subd. 2.  Medical School
               441,000        455,000
        The state of Minnesota shall pay a 
        capitation of $11,047 in the first year 
        and $11,378 in the second year for each 
        student who is a resident of 
        Minnesota.  The appropriation may be 
        transferred between years of the 
        biennium to accommodate enrollment 
        fluctuations. 
        The legislature intends that during the 
        biennium the Mayo foundation use the 
        capitation money to increase the number 
        of doctors practicing in rural areas in 
        need of doctors.  
        Subd. 3.  Family Practice and
        Graduate Residency Program
               408,000        467,000
        The state of Minnesota provides a 
        capitation of $15,107 in the first year 
        and $15,560 in the second year for each 
        student. 
        Subd. 4.  St. Cloud Hospital-Mayo 
        Family Practice Residency Program 
               300,000        360,000
        This appropriation is to the Mayo 
        foundation to support 10 resident 
        physicians in the first year and 12 
        resident physicians in the second year 
        in the St. Cloud Hospital-Mayo Family 
        Practice Residency Program.  The 
        program shall prepare doctors to 
        practice primary care medicine in the 
        rural areas of the state.  It is 
        intended that this program will improve 
        health care in rural communities, 
        provide affordable access to 
        appropriate medical care, and manage 
        the treatment of patients in a more 
        cost-effective manner. 
        Sec. 6.  POST-SECONDARY SYSTEMS 
        The legislature intends that the 
        University of Minnesota and the 
        Minnesota state colleges and 
        universities correct technical college 
        credit transfer problems.  The systems, 
        in conjunction with their campuses and 
        with faculty and student 
        representatives, shall convene faculty 
        task forces in appropriate curricular 
        areas to determine, within sound 
        academic standards, which technical 
        college courses shall transfer to 
        academic institutions and whether each 
        course is accepted for general 
        education, major field, or elective 
        credit.  The task forces shall complete 
        their work in time to implement changes 
        for the 1998-1999 academic year.  The 
        systems shall develop mechanisms for 
        assessing the success of the changes 
        after they have been implemented and 
        shall determine whether this process 
        should be used to update the entire 
        transfer curriculum, particularly in 
        light of semester conversion.  The 
        systems shall report on their progress 
        and recommendations for any further 
        action as part of the 2000-2001 
        biennial budget request.  By February 
        1, 1998, the systems shall provide a 
        brief progress report that includes an 
        assessment of the feasibility of common 
        course numbering. 
        A college or university that 
        establishes a lab school shall report 
        to its governing board and the higher 
        education divisions of the legislature 
        by February 1, 1999, on all direct and 
        indirect expenditures related to the 
        establishment and operation of the 
        school.  The report shall include 
        documentation of all sources of 
        financing for these expenses. 
        The University of Minnesota and the 
        Minnesota state colleges and 
        universities shall jointly prepare a 
        report to be submitted to the higher 
        education divisions of the legislature 
        by February 1, 1998, that provides a 
        detailed review of current and planned 
        expenditures on information 
        technology.  The plan shall specify the 
        goals and objectives of the systems and 
        the campuses in their use of technology 
        and demonstrate how these goals and 
        objectives will serve the state's 
        interest in higher education. 
                                   ARTICLE 2
                             COLLEGE AFFORDABILITY
           Section 1.  [16A.645] [GOPHER STATE BONDS.] 
           Subdivision 1.  [ESTABLISHMENT OF PROGRAM.] The 
        commissioner of finance, in consultation with the University of 
        Minnesota, the Minnesota state colleges and universities, and 
        the private college council, shall establish a college savings 
        bond program, to be known as "gopher state bonds" to encourage 
        individuals to save for higher education costs by investing in 
        state general obligation bonds.  The program consists of:  (1) 
        issuing a portion of the state general obligation bonds in zero 
        coupon form and in denominations and maturities that will be 
        attractive to individuals saving to pay for higher education 
        costs; and (2) developing a program for marketing the bonds to 
        investors who are saving to pay for higher education costs.  The 
        commissioner of finance may designate all or a portion of each 
        state general obligation bond sale as "gopher state bonds." 
           Subd. 2.  [DENOMINATIONS; MATURITIES.] The commissioner 
        shall determine the appropriate denominations and maturities for 
        gopher state bonds.  It is the intent of the legislature to make 
        bonds available in as small denominations as is feasible given 
        the costs of marketing and administering the bond issue.  
        Minimum denominations of $500 must be made available.  The 
        minimum denomination bonds need not be made available for bonds 
        of all maturities.  For purposes of this section, "denomination" 
        means the compounded maturity amount of the bond. 
           Subd. 3.  [DIRECT SALE PERMITTED.] Notwithstanding the 
        provisions of section 16A.646, subdivision 5, the commissioner 
        may sell any series of gopher state bonds directly to the public 
        or to financial institutions for prompt resale to the public 
        upon the terms and conditions and the restrictions the 
        commissioner prescribes.  The commissioner may enter into all 
        contracts deemed necessary or desirable to accomplish the sale 
        in a cost-effective manner including a private or negotiated 
        sale, but the commissioner may contract for investment banking 
        and banking services only after receiving competitive proposals 
        for the services. 
           Subd. 4.  [MARKETING PLAN.] The commissioner and the higher 
        education advisory council shall develop a plan for marketing 
        gopher state bonds. 
           The plan must include strategies to: 
           (1) inform parents and relatives about the availability of 
        the bonds; 
           (2) take orders for the bonds; 
           (3) target the sale of the bonds to Minnesota residents, 
        especially parents and relatives of children who are likely to 
        seek higher education; 
           (4) ensure that purchase of the bonds by corporations will 
        not prevent individuals and relatives of future students from 
        buying them; and 
           (5) market the bonds at the lowest cost to the state. 
           Subd. 5.  [EFFECT ON STUDENT GRANTS.] The first $25,000 of 
        gopher state bonds purchased for the benefit of a student must 
        not be considered in determining the financial need of an 
        applicant for the state grant program under section 136A.121. 
        This $25,000 is in addition to any other asset exclusion 
        authorized under chapter 136A. 
           Sec. 2.  [16A.646] [ZERO COUPON BONDS.] 
           Subdivision 1.  [AUTHORITY TO ISSUE.] When authorized by 
        law to issue state general obligation bonds, the commissioner 
        may issue all or part of the bonds as serial maturity bonds or 
        as zero coupon bonds or a combination of the two. 
           Subd. 2.  [DEFINITIONS.] For purposes of this section and 
        section 16A.645, the following terms have the meanings given 
        them. 
           (a) "Compounded maturity" means the amount of principal and 
        interest payable at maturity on zero coupon bonds. 
           (b) "Serial maturity bonds" means bonds maturing on a 
        specified day in two or more consecutive years and bearing 
        interest at a specified rate payable periodically to maturity or 
        prior redemption. 
           (c) "Zero coupon bonds" means bonds in a stated principal 
        amount, maturing on a specified date or dates, and bearing 
        interest that accrues and compounds to and is payable only at 
        maturity or upon prior redemption of the bonds. 
           Subd. 3.  [METHOD OF SALE; PRINCIPAL AMOUNT.] Except as 
        otherwise provided by this section or section 16A.645, any 
        series of bonds including zero coupon bonds must be issued and 
        sold under the provisions of section 16A.641.  The stated 
        principal amount of zero coupon bonds must be used to determine 
        the principal amount of bonds issued under the laws authorizing 
        issuance of state general obligation bonds. 
           Subd. 4.  [SINKING FUND.] The commissioner's order 
        authorizing the issuance of zero coupon bonds shall establish a 
        separate sinking fund account for the zero coupon bonds in the 
        state bond fund.  There is annually appropriated from the 
        general fund to each zero coupon bond account, beginning in the 
        year in which the zero coupon bonds are issued, an amount not 
        less than the sum of: 
           (1) the total stated principal amount of the zero coupon 
        bonds that would have matured from their date of issue to and 
        including the second July 1 following the transfer of 
        appropriated money, if the bonds matured serially in an equal 
        principal amount in each year during their term and in the same 
        month as their stated maturity date; plus 
           (2) the total amount of interest accruing on the stated 
        principal amount of the bonds and on interest previously 
        accrued, from bonds date of issue to and including the second 
        July 1 following the transfer of appropriated money; less 
           (3) the amount in the sinking fund account for the payment 
        of the compounded maturity amount of the bonds, including 
        interest earnings on amounts in the account.  This appropriation 
        is in lieu of all other appropriations made with respect to zero 
        coupon bonds.  The appropriated amounts must be transferred from 
        the general fund to the sinking fund account in the state bond 
        fund by December 1 of each year. 
           Subd. 5.  [SALE.] Except as otherwise provided in section 
        16A.645, zero coupon bonds, or a series of bonds including zero 
        coupon bonds, must be sold at public sale at a price not less 
        than 98 percent of their stated principal amount.  No state 
        trunk highway bond may be sold for a price of less than par and 
        accrued interest. 
           Sec. 3.  Minnesota Statutes 1996, section 136A.101, is 
        amended by adding a subdivision to read: 
           Subd. 5a.  [ASSIGNED FAMILY RESPONSIBILITY.] "Assigned 
        family responsibility" means the amount of a family contribution 
        to a student's cost of attendance, as determined by a federal 
        need analysis, except that, beginning for the 1998-1999 academic 
        year, up to $25,000 in savings and other assets shall be 
        subtracted from the federal calculation of net worth before 
        determining the contribution.  For dependent students, the 
        assigned family responsibility is the parental contribution.  
        For independent students with dependents other than a spouse, 
        the assigned family responsibility is the student contribution. 
        For independent students without dependents other than a spouse, 
        the assigned family responsibility is 80 percent of the student 
        contribution. 
           Sec. 4.  Minnesota Statutes 1996, section 136A.121, 
        subdivision 5, is amended to read: 
           Subd. 5.  [GRANT STIPENDS.] The grant stipend shall be 
        based on a sharing of responsibility for covering the recognized 
        cost of attendance by the applicant, the applicant's family, and 
        the government.  The amount of a financial stipend must not 
        exceed a grant applicant's recognized cost of attendance, as 
        defined in subdivision 6, after deducting the following:  
           (1) the assigned student responsibility of at least 50 
        percent of the cost of attending the institution of the 
        applicant's choosing; 
           (2) the assigned family responsibility, as determined by 
        the federal need analysis, which for (i) dependent students, is 
        the parental contribution as calculated by the federal need 
        analysis, and for (ii) independent students, is the student 
        contribution as determined by the federal need analysis; and as 
        defined in section 136A.101; and 
           (3) the amount of a federal Pell grant award for which the 
        grant applicant is eligible. 
           The minimum financial stipend is $300 per academic year. 
           Sec. 5.  Minnesota Statutes 1996, section 136A.121, 
        subdivision 9a, is amended to read: 
           Subd. 9a.  [FULL-YEAR GRANTS.] Students may receive state 
        grants for four consecutive quarters or three consecutive 
        semesters during the course of a single fiscal year.  In 
        calculating a state grant for the fourth quarter or third 
        semester, the office must use the same calculation as it would 
        for any other term, except that the calculation must subtract 
        any Pell grant for which a student would be eligible even if the 
        student has exhausted the Pell grant for that fiscal year. 
           Sec. 6.  Minnesota Statutes 1996, section 136A.125, 
        subdivision 4, is amended to read: 
           Subd. 4.  [AMOUNT AND LENGTH OF GRANTS.] The amount of a 
        child care grant must be based on: 
           (1) the income of the applicant and the applicant's spouse, 
        if any; 
           (2) the number in the applicant's family, as defined by the 
        office; and 
           (3) the number of eligible children in the applicant's 
        family.  
           The maximum award to the applicant shall be $1,700 $2,000 
        for each eligible child per academic year.  The office shall 
        prepare a chart to show the amount of a grant that will be 
        awarded per child based on the factors in this subdivision.  The 
        chart shall include a range of income and family size. 
           Sec. 7.  Minnesota Statutes 1996, section 136A.1355, is 
        amended to read: 
           136A.1355 [RURAL PHYSICIANS.] 
           Subdivision 1.  [CREATION OF ACCOUNT.] A rural physician 
        education account is established in the health care access 
        fund.  The higher education services office commissioner shall 
        use money from the account to establish a loan forgiveness 
        program for medical students residents agreeing to practice in 
        designated rural areas, as defined by the commissioner.  
           Subd. 2.  [ELIGIBILITY.] To be eligible to participate in 
        the program, a prospective physician must submit a letter of 
        interest to the higher education services office commissioner.  
        A student or resident who is accepted must sign a contract to 
        agree to serve at least three of the first five years following 
        residency in a designated rural area. 
           Subd. 3.  [LOAN FORGIVENESS.] For each fiscal years 
        beginning on and year after July 1, 1995, the higher education 
        services office commissioner may accept up to four applicants 
        who are fourth year medical students, three 12 applicants who 
        are medical residents, including four applicants who are 
        pediatric residents, and four six applicants who are family 
        practice residents, and one applicant who is an two applicants 
        who are internal medicine resident residents, per fiscal year 
        for participation in the loan forgiveness program.  If 
        the higher education services office commissioner does not 
        receive enough applicants per fiscal year to fill the number of 
        residents in the specific areas of practice, the resident 
        applicants may be from any area of practice.  The eight 12 
        resident applicants may be in any year of training; however, 
        priority must be given to the following categories of residents 
        in descending order:  third year residents, second year 
        residents, and first year residents.  Applicants are responsible 
        for securing their own loans.  Applicants chosen to participate 
        in the loan forgiveness program may designate for each year of 
        medical school, up to a maximum of four years, an agreed amount, 
        not to exceed $10,000, as a qualified loan.  For each year that 
        a participant serves as a physician in a designated rural area, 
        up to a maximum of four years, the higher education services 
        office commissioner shall annually pay an amount equal to one 
        year of qualified loans.  Participants who move their practice 
        from one designated rural area to another remain eligible for 
        loan repayment.  In addition, if in any year that a resident 
        participating in the loan forgiveness program serves at least 
        four weeks during a year of residency substituting for a rural 
        physician to temporarily relieve the rural physician of rural 
        practice commitments to enable the rural physician to take a 
        vacation, engage in activities outside the practice area, or 
        otherwise be relieved of rural practice commitments, the 
        participating resident may designate up to an additional $2,000, 
        above the $10,000 yearly maximum, for each year of residency 
        during which the resident substitutes for a rural physician for 
        four or more weeks. 
           Subd. 4.  [PENALTY FOR NONFULFILLMENT.] If a participant 
        does not fulfill the required three-year minimum commitment of 
        service in a designated rural area, the higher education 
        services office commissioner shall collect from the participant 
        the amount paid by the commissioner under the loan forgiveness 
        program.  The higher education services office commissioner 
        shall deposit the money collected in the rural physician 
        education account established in subdivision 1.  The 
        commissioner shall allow waivers of all or part of the money 
        owed the commissioner if emergency circumstances prevented 
        fulfillment of the three-year service commitment.  
           Subd. 5.  [LOAN FORGIVENESS; UNDERSERVED URBAN 
        COMMUNITIES.] For each fiscal years year beginning on and after 
        July 1, 1995, the higher education services office commissioner 
        may accept up to four applicants who are either fourth year 
        medical students, or residents in family practice, pediatrics, 
        or internal medicine per fiscal year for participation in the 
        urban primary care physician loan forgiveness program.  The 
        resident applicants may be in any year of residency training; 
        however, priority will be given to the following categories of 
        residents in descending order:  third year residents, second 
        year residents, and first year residents.  If the higher 
        education services office commissioner does not receive enough 
        qualified applicants per fiscal year to fill the number of slots 
        for urban underserved communities, the slots may be allocated to 
        students or residents who have applied for the rural physician 
        loan forgiveness program in subdivision 1.  Applicants are 
        responsible for securing their own loans.  For purposes of this 
        provision, "qualifying educational loans" are government and 
        commercial loans for actual costs paid for tuition, reasonable 
        education expenses, and reasonable living expenses related to 
        the graduate or undergraduate education of a health care 
        professional.  Applicants chosen to participate in the loan 
        forgiveness program may designate for each year of medical 
        school, up to a maximum of four years, an agreed amount, not to 
        exceed $10,000, as a qualified loan.  For each year that a 
        participant serves as a physician in a designated underserved 
        urban area, up to a maximum of four years, the higher education 
        services office commissioner shall annually pay an amount equal 
        to one year of qualified loans.  Participants who move their 
        practice from one designated underserved urban community to 
        another remain eligible for loan repayment. 
           Sec. 8.  Minnesota Statutes 1996, section 136A.136, 
        subdivision 2, is amended to read: 
           Subd. 2.  [RESPONSIBILITY OF METROPOLITAN HEALTHCARE 
        FOUNDATION'S PROJECT LINC.] The metropolitan healthcare 
        foundation's project LINC shall administer the grant program and 
        award grants to eligible health care facility employees.  To be 
        eligible to receive a grant, a person must be: 
           (1) an employee of a health care facility located in 
        Minnesota, whom the facility has recommended to the metropolitan 
        healthcare foundation's project LINC for consideration; 
           (2) working part time, up to 32 fewer hours than the 
        person's regular schedule per pay period, for the health care 
        facility organization, while maintaining full salary and 
        original benefits and a salary greater than the number of hours 
        worked; 
           (3) enrolled full time in a Minnesota school or college of 
        nursing to complete a baccalaureate or master's degree in 
        nursing; and 
           (4) a resident of the state of Minnesota. 
           The grant must be awarded for one academic year but is 
        renewable for a maximum of six semesters or nine quarters of 
        full-time study, or their equivalent.  The grant must be used 
        for tuition, fees, and books.  Priority in awarding grants shall 
        be given to persons with the greatest financial need.  The 
        health care facility may require its employee to commit to a 
        reasonable postprogram completion of employment at the health 
        care facility as a condition for the financial support the 
        facility provides. 
           Sec. 9.  Minnesota Statutes 1996, section 136A.233, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] For purposes of sections 136A.231 
        to 136A.233, the words defined in this subdivision have the 
        meanings ascribed to them. 
           (a) "Eligible student" means a Minnesota resident enrolled 
        or intending to enroll at least half time in a degree, diploma, 
        or certificate program in a Minnesota post-secondary institution.
           (b) "Minnesota resident" means a student who meets the 
        conditions in section 136A.101, subdivision 8. 
           (c) "Financial need" means the need for financial 
        assistance in order to attend a post-secondary institution as 
        determined by a post-secondary institution according to 
        guidelines established by the higher education services office. 
           (d) "Eligible employer" means any eligible post-secondary 
        institution and, any nonprofit, nonsectarian agency or state 
        institution located in the state of Minnesota, including state 
        hospitals, and also includes a handicapped person or a person 
        over 65 who employs a student to provide personal services in or 
        about the person's residence of the handicapped person or the 
        person over 65, or a private, for-profit employer employing a 
        student as an intern in a position directly related to the 
        student's field of study that will enhance the student's 
        knowledge and skills in that field.  
           (e) "Eligible post-secondary institution" means any 
        post-secondary institution eligible for participation in the 
        Minnesota state grant program as specified in section 136A.101, 
        subdivision 4. 
           (f) "Independent student" has the meaning given it in the 
        Higher Education Act of 1965, United States Code, title 20, 
        section 1070a-6, and applicable regulations. 
           (g) "Half-time" for undergraduates has the meaning given in 
        section 136A.101, subdivision 7b, and for graduate students is 
        defined by the institution. 
           Sec. 10.  Minnesota Statutes 1996, section 136A.233, 
        subdivision 3, is amended to read: 
           Subd. 3.  [PAYMENTS.] Work-study payments shall be made to 
        eligible students by post-secondary institutions as provided in 
        this subdivision. 
           (a) Students shall be selected for participation in the 
        program by the post-secondary institution on the basis of 
        student financial need. 
           (b) In selecting students for participation, priority must 
        be given to students enrolled for at least 12 credits. 
           (c) Students will be paid for hours actually worked and the 
        maximum hourly rate of pay shall not exceed the maximum hourly 
        rate of pay permitted under the federal college work-study 
        program. 
           (d) Minimum pay rates will be determined by an applicable 
        federal or state law. 
           (e) The office shall annually establish a minimum 
        percentage rate of student compensation to be paid by an 
        eligible employer. 
           (f) Each post-secondary institution receiving money for 
        state work-study grants shall make a reasonable effort to place 
        work-study students in employment with eligible employers 
        outside the institution.  However, a public employer other than 
        the institution may not terminate, lay off, or reduce the 
        working hours of a permanent employee for the purpose of hiring 
        a work-study student, or replace a permanent employee who is on 
        layoff from the same or substantially the same job by hiring a 
        work-study student. 
           (g) The percent of the institution's work-study allocation 
        provided to graduate students shall not exceed the percent of 
        graduate student enrollment at the participating institution. 
           (h) An institution may use up to 30 percent of its 
        allocation for student internships with private, for-profit 
        employers. 
           Sec. 11.  Minnesota Statutes 1996, section 136A.233, is 
        amended by adding a subdivision to read: 
           Subd. 4.  [COOPERATION WITH LOCAL SCHOOLS.] Each campus 
        using the state work study program is encouraged to cooperate 
        with its local public elementary and secondary schools to place 
        college work study students in activities in the schools, such 
        as tutoring.  Students must be placed in meaningful activities 
        that directly assist students in kindergarten through grade 12 
        in meeting graduation standards including the profiles of 
        learning.  College students shall work under direct supervision; 
        therefore, school hiring authorities are not required to request 
        criminal background checks on these students under section 
        120.1045. 
           Sec. 12.  [136A.241] [EDVEST PROGRAM ESTABLISHED.] 
           An EdVest savings program is established.  In establishing 
        this program, the legislature seeks to encourage individuals to 
        save for post-secondary education by: 
           (1) providing a qualified state tuition program under 
        federal tax law; 
           (2) providing matching grants for contributions to the 
        program by low- and middle-income families; and 
           (3) by encouraging individuals, foundations, and businesses 
        to provide additional grants to participating students. 
           Sec. 13.  [136A.242] [DEFINITIONS.] 
           Subdivision 1.  [GENERAL.] For purposes of sections 
        136A.241 to 136A.245, the following terms have the meanings 
        given. 
           Subd. 2.  [ADJUSTED GROSS INCOME.] "Adjusted gross income" 
        means adjusted gross income as defined in section 62 of the 
        Internal Revenue Code. 
           Subd. 3.  [BENEFICIARY.] "Beneficiary" means the designated 
        beneficiary for the account, as defined in section 529(e)(1) of 
        the Internal Revenue Code. 
           Subd. 4.  [BOARD.] "Board" means the state board of 
        investment. 
           Subd. 5.  [DIRECTOR.] "Director" means the director of the 
        higher education services office. 
           Subd. 6.  [EXECUTIVE DIRECTOR.] "Executive director" means 
        the executive director of the state board of investment. 
           Subd. 7.  [INTERNAL REVENUE CODE.] "Internal Revenue Code" 
        means the Internal Revenue Code of 1986, as amended. 
           Subd. 8.  [OFFICE.] "Office" means the higher education 
        services office. 
           Subd. 9.  [PROGRAM.] "Program" or "EdVest" refers to the 
        program established under sections 136A.241 to 136A.245. 
           Sec. 14.  [136A.243] [HIGHER EDUCATION SERVICES OFFICE.] 
           Subdivision 1.  [RESPONSIBILITIES.] (a) The director shall 
        establish the rules, terms, and conditions for the program, 
        subject to the requirements of sections 136A.241 to 136A.245. 
           (b) The director shall prescribe the application forms, 
        procedures, and other requirements that apply to the program. 
           Subd. 2.  [ACCOUNTS-TYPE PROGRAM.] The office must 
        establish the program and the program must be operated as an 
        accounts-type program that permits individuals to save for 
        qualified higher education costs incurred at any institution, 
        regardless of whether it is private or public or whether it is 
        located within or outside of this state.  A separate account 
        must be maintained for each beneficiary for whom contributions 
        are made. 
           Subd. 3.  [CONSULTATION WITH STATE BOARD OF INVESTMENT.] In 
        designing and establishing the program's requirements and in 
        negotiating or entering contracts with third parties under 
        subdivision 8, the director shall consult with the executive 
        director. 
           Subd. 4.  [PROGRAM TO COMPLY WITH FEDERAL LAW.] The 
        director shall take steps to ensure that the program meets the 
        requirements for a qualified state tuition program under section 
        529 of the Internal Revenue Code.  The director may request a 
        private letter ruling or rulings from the Internal Revenue 
        Service or take any other steps to ensure that the program 
        qualifies under section 529 of the Internal Revenue Code or 
        other relevant provisions of federal law. 
           Subd. 5.  [MINIMUM PENALTY.] In establishing the terms of 
        the program, the office must provide that refunds of amounts in 
        an account are subject to a minimum penalty, as required by 
        section 529(b)(3) of the Internal Revenue Code.  If the refunds 
        or payments are not used for qualified higher education expenses 
        of the designated beneficiary, this penalty must equal, at 
        least, the proportionate amount of any matching grants deposited 
        in the account under section 136A.245 and the investment return 
        on the grants, plus an additional penalty that meets the 
        requirement of federal law. 
           Subd. 6.  [THREE-YEAR PERIOD FOR WITHDRAWAL OF GRANTS.] A 
        matching grant deposited in the account under section 136A.245 
        may not be withdrawn within three years of the establishment of 
        the account of the beneficiary.  In calculating the three-year 
        period, the period held in another account is included, if the 
        account includes a rollover from another account under section 
        529(c)(3)(C) of the Internal Revenue Code. 
           Subd. 7.  [MARKETING.] The director shall make parents and 
        other interested individuals aware of the availability and 
        advantages of the program as a way to save for higher education 
        costs.  The cost of these promotional efforts must be paid 
        entirely from state general fund appropriations and may not be 
        funded with fees imposed on participants. 
           Subd. 8.  [ADMINISTRATION.] The director shall administer 
        the program, including accepting and processing applications, 
        maintaining account records, making payments, making matching 
        grants under section 136A.245, and undertaking any other 
        necessary tasks to administer the program.  The office may 
        contract with one or more third parties to carry out some or all 
        of these administrative duties, including promotion and 
        marketing of the program.  The office and the board may jointly 
        contract with third-party providers, if the office and board 
        determine that it is desirable to contract with the same entity 
        or entities for administration and investment management. 
           Subd. 9.  [AUTHORITY TO IMPOSE FEES.] The office may impose 
        fees on participants in the program to recover the costs of 
        administration.  The office must use its best efforts to keep 
        these fees as low as possible, consistent with efficient 
        administration, so that the returns on savings invested in the 
        program will be as high as possible. 
           Sec. 15.  [136A.244] [INVESTMENT OF ACCOUNTS.] 
           Subdivision 1.  [STATE BOARD TO INVEST.] The state board of 
        investment shall invest the money deposited in accounts in the 
        program. 
           Subd. 2.  [PERMITTED INVESTMENTS.] The board may invest the 
        accounts in any permitted investment under section 11A.24.  
           Subd. 3.  [CONTRACTING AUTHORITY.] The board may contract 
        with one or more third parties for investment management, 
        recordkeeping, or other services in connection with investing 
        the accounts.  The board and office may jointly contract with 
        third-party providers, if the office and board determine that it 
        is desirable to contract with the same entity or entities for 
        administration and investment management. 
           Subd. 4.  [FEES.] The board may impose fees on participants 
        in the program to recover the cost of investment management and 
        related tasks for the program.  The board must use its best 
        efforts to keep these fees as low as possible, consistent with 
        high quality investment management, so that the returns on 
        savings invested in the program will be as high as possible. 
           Sec. 16.  [136A.245] [MATCHING GRANTS.] 
           Subdivision 1.  [MATCHING GRANT QUALIFICATION.] By March 1 
        of each year, a state matching grant must be added to each 
        account established under the program if the following 
        conditions are met: 
           (1) the contributor applies, in writing in a form 
        prescribed by the director, for a matching grant; 
           (2) a minimum contribution of $200 was made during the 
        preceding calendar year; and 
           (3) the family income of the beneficiary did not exceed 
        $80,000. 
           Subd. 2.  [FAMILY INCOME.] For purposes of this section, 
        "family income" means: 
           (1) if the beneficiary is under age 25, the combined 
        adjusted gross income of the beneficiary's parents as reported 
        on the federal tax return or returns for the most recently 
        available tax year; or 
           (2) if the beneficiary is age 25 or older, the combined 
        adjusted gross income of the beneficiary and spouse, if any. 
           Subd. 3.  [AMOUNT OF MATCHING GRANT.] The amount of the 
        matching grant for a beneficiary equals: 
           (1) if the beneficiary's family income is $50,000 or less, 
        15 percent of the sum of the contributions made to the 
        beneficiary's account during the calendar year, not to exceed 
        $300; and 
           (2) if the beneficiary's family income is more than $50,000 
        but not more than $80,000, five percent of the sum of the 
        contributions made to the beneficiary's account during the 
        calendar year, not to exceed $300. 
           Subd. 4.  [BUDGET LIMIT.] If the total amount of matching 
        grants determined under subdivision 3 exceeds the amount of the 
        appropriation for the fiscal year, the director shall 
        proportionately reduce each grant so that the total equals the 
        available appropriation. 
           Subd. 5.  [COORDINATION WITH DEPARTMENT OF REVENUE.] In 
        administering matching grants, the director may require that 
        applicants submit sufficient information to determine whether 
        the beneficiary qualifies for a grant, including the Social 
        Security numbers, family income information, and any other 
        information the director determines necessary.  The applicant or 
        applicants may authorize the director to request information 
        from the commissioner of revenue to verify eligibility for a 
        grant from tax information on file with the commissioner or 
        obtained from the Internal Revenue Service.  If this method is 
        used and the taxpayer has authorized a release of the 
        information to the director, the commissioner of revenue may 
        verify that the beneficiary is eligible for a grant at a 
        specified rate and maximum and disclose that information to the 
        director, notwithstanding the provisions of chapter 270B. 
           Subd. 6.  [PRIVATE CONTRIBUTIONS.] (a) The office may 
        solicit and accept contributions from private corporations, 
        other businesses, foundations, or individuals to provide: 
           (1) matching grants under this section in addition to those 
        funded with direct appropriations; or 
           (2) grants to students who withdraw money from accounts 
        established under the program. 
           (b) Amounts contributed may only be used for those 
        purposes.  Amounts contributed are appropriated to the director 
        to make grants. 
           (c) Contributors may designate a specific field of study, 
        geographic area, or other criteria that govern use of the grants 
        funded with their contributions, but may not discriminate on the 
        basis of race, ethnicity, or gender.  The office may refuse 
        contributions that are subject, in the judgment of the director, 
        to unacceptable conditions on their use. 
           Sec. 17.  Minnesota Statutes 1996, section 181.06, 
        subdivision 2, is amended to read: 
           Subd. 2.  [PAYROLL DEDUCTIONS.] A written contract may be 
        entered into between an employer and an employee wherein the 
        employee authorizes the employer to make payroll deductions for 
        the purpose of paying union dues, premiums of any life 
        insurance, hospitalization and surgical insurance, group 
        accident and health insurance, group term life insurance, group 
        annuities or contributions to credit unions or a community chest 
        fund, a local arts council, a local science council or a local 
        arts and science council, or Minnesota benefit association, a 
        federally or state registered political action committee, or 
        participation in any employee stock purchase plan or savings 
        plan for periods longer than 60 days, including gopher state 
        bonds established under section 16A.645. 
           Sec. 18.  [STUDENT FEES.] 
           By December 1, 1998, the higher education services office 
        shall provide information to the public post-secondary boards 
        advising them how to maximize financial aid when establishing 
        student fees. 
           Sec. 19.  [NATIONAL SERVICE SCHOLARS PROGRAM.] 
           A national service scholars program is established under 
        the administration of the higher education services office to 
        match scholarship grants made under the National Service 
        Scholars program of the Corporation for National Service to 
        students attending Minnesota high schools and who will attend a 
        Minnesota post-secondary institution.  Not more than one 
        matching grant of $500 may be made for each high school per 
        year.  The state money shall be available until June 30, 1999, 
        if federal money is available. 
           Sec. 20.  [REVISOR'S INSTRUCTION.] 
           The revisor of statutes shall renumber Minnesota Statutes, 
        section 136A.1355, in an appropriate place in Minnesota 
        Statutes, chapter 144. 
           Sec. 21.  [EFFECTIVE DATE.] 
           Section 5 is effective the day following final enactment.  
        Sections 1, 2, and 17 are effective for the sale of general 
        obligation bonds after July 1, 1998. 
                                   ARTICLE 3
                                OTHER PROVISIONS
           Section 1.  Minnesota Statutes 1996, section 16A.69, 
        subdivision 2, is amended to read: 
           Subd. 2.  [TRANSFER BETWEEN ACCOUNTS.] Upon the awarding of 
        final contracts for the completion of a project for construction 
        or other permanent improvement, or upon the abandonment of the 
        project, the agency to whom the appropriation was made may 
        transfer the unencumbered balance in the project account to 
        another project enumerated in the same section of that 
        appropriation act.  The transfer must be made only to cover bids 
        for the other project that were higher than was estimated when 
        the appropriation for the other project was made and not to 
        cover an expansion of the other project.  The money transferred 
        under this section is appropriated for the purposes for which 
        transferred.  For transfers for technical colleges by the state 
        board of technical of trustees of the Minnesota state colleges 
        and universities, the total cost of both projects and the 
        required local share for both projects are adjusted 
        accordingly.  The agency proposing a transfer shall report to 
        the chair of the senate finance committee and the chair of the 
        house of representatives ways and means committee before the 
        transfer is made under this subdivision. 
           Sec. 2.  [41D.01] [MINNESOTA AGRICULTURE EDUCATION 
        LEADERSHIP COUNCIL.] 
           Subdivision 1.  [ESTABLISHMENT; MEMBERSHIP.] The Minnesota 
        agriculture education leadership council is established.  The 
        council is composed of 16 members as follows: 
           (1) the chair of the University of Minnesota agricultural 
        education program; 
           (2) a representative of the commissioner of children, 
        families, and learning; 
           (3) a representative of the Minnesota state colleges and 
        universities recommended by the chancellor; 
           (4) the president and the president-elect of the Minnesota 
        vocational agriculture instructors association; 
           (5) a representative of the Future Farmers of America 
        Foundation; 
           (6) a representative of the commissioner of agriculture; 
           (7) the dean of the college of agriculture, food, and 
        environmental sciences at the University of Minnesota; 
           (8) two members representing agriculture education and 
        agriculture business appointed by the governor; 
           (9) the chair of the senate committee on agriculture and 
        rural development; 
           (10) the chair of the house committee on agriculture; 
           (11) the ranking minority member of the senate committee on 
        agriculture and rural development, and a member of the senate 
        committee on children, families and learning designated by the 
        subcommittee on committees of the committee on rules and 
        administration; and 
           (12) the ranking minority member of the house agriculture 
        committee, and a member of the house education committee 
        designated by the speaker. 
           Subd. 2.  [POWERS AND DUTIES.] Specific powers and duties 
        of the council are to: 
           (1) develop recommendations to the legislature and the 
        governor and provide review for agriculture education programs 
        in Minnesota; 
           (2) establish a grant program to foster and encourage the 
        development of secondary and post-secondary agriculture 
        education programs; 
           (3) coordinate and articulate Minnesota's agriculture 
        education policy across all programs and institutions; 
           (4) identify the critical needs for agriculture educators; 
           (5) serve as a link between the agribusiness sector and the 
        agriculture education system to communicate mutual concerns, 
        needs, and projections; 
           (6) establish and maintain an increased awareness of 
        agriculture education and its continued need to all citizens of 
        Minnesota; 
           (7) operate the Minnesota center for agriculture education 
        created in section 41D.03; 
           (8) gain broad public support for agriculture education in 
        Minnesota; and 
           (9) report annually on its activities to the senate 
        agriculture and rural development committee and the house 
        agriculture committee. 
           Subd. 3.  [COUNCIL OFFICERS; TERMS AND COMPENSATION OF 
        APPOINTEES; STAFF.] (a) The chair of the senate agriculture and 
        rural development committee and the chair of the house 
        agriculture committee are the cochairs of the council. 
           (b) The council's membership terms, compensation, filling 
        of vacancies, and removal of members are as provided in section 
        15.0575. 
           (c) The council may employ an executive director and any 
        other staff to carry out its functions. 
           Subd. 4.  [EXPIRATION.] This section expires on June 30, 
        2002. 
           Sec. 3.  [41D.02] [AGRICULTURE EDUCATION GRANT PROGRAM.] 
           Subdivision 1.  [ESTABLISHMENT.] The Minnesota agriculture 
        education leadership council shall establish a program to 
        provide grants under subdivisions 2 and 3 to educational 
        institutions and other appropriate entities for secondary and 
        post-secondary agriculture education programs. 
           Subd. 2.  [SECONDARY AGRICULTURAL EDUCATION.] The council 
        may provide grants for: 
           (1) planning and establishment costs for secondary 
        agriculture education programs; 
           (2) new instructional and communication technologies; and 
           (3) curriculum updates. 
           Subd. 3.  [POST-SECONDARY EDUCATION.] The council may 
        provide grants for: 
           (1) new instructional and communication technologies; and 
           (2) special project funding, including programming, 
        in-service training, and support staff. 
           Sec. 4.  [41D.03] [MINNESOTA CENTER FOR AGRICULTURE 
        EDUCATION.] 
           Subdivision 1.  [GOVERNANCE.] The Minnesota center for 
        agriculture education is governed by the Minnesota agriculture 
        education leadership council. 
           Subd. 2.  [POWERS AND DUTIES OF COUNCIL.] (a) The council 
        has the powers necessary for the care, management, and control 
        of the Minnesota center for agriculture education and all its 
        real and personal property.  The powers shall include, but are 
        not limited to, those listed in this subdivision. 
           (b) The council may employ necessary employees, and 
        contract for other services to ensure the efficient operation of 
        the center for agriculture education. 
           (c) The council may receive and award grants.  The council 
        may establish a charitable foundation and accept, in trust or 
        otherwise, any gift, grant, bequest, or devise for educational 
        purposes and hold, manage, invest, and dispose of them and the 
        proceeds and income of them according to the terms and 
        conditions of the gift, grant, bequest, or devise and its 
        acceptance.  The council shall adopt internal procedures to 
        administer and monitor aids and grants. 
           (d) The council may establish or coordinate evening, 
        continuing education, and summer programs for teachers and 
        pupils. 
           (e) The council may determine the location for the 
        Minnesota center for agriculture education and any additional 
        facilities related to the center, including the authority to 
        lease a temporary facility. 
           (f) The council may enter into contracts with other public 
        and private agencies and institutions for building maintenance 
        services if it determines that these services could be provided 
        more efficiently and less expensively by a contractor than by 
        the council itself.  The council may also enter into contracts 
        with public or private agencies and institutions, school 
        districts or combinations of school districts, or educational 
        cooperative service units to provide supplemental educational 
        instruction and services. 
           Subd. 3.  [CENTER ACCOUNT.] There is established in the 
        state treasury a center for agriculture education account in the 
        special revenue fund.  All money collected by the council, 
        including rental income, shall be deposited in the account.  
        Money in the account, including interest earned, is appropriated 
        to the council for the operation of its services and programs. 
           Subd. 4.  [EMPLOYEES.] (a) The council shall employ persons 
        who shall serve in the unclassified service. 
           (b) The employees hired under this subdivision and any 
        other necessary employees hired by the council shall be state 
        employees in the executive branch. 
           Subd. 5.  [POLICIES.] The council may adopt administrative 
        policies about the operation of the center. 
           Subd. 6.  [PUBLIC POST-SECONDARY INSTITUTIONS; PROVIDING 
        SPACE.] Public post-secondary institutions shall provide space 
        for the Minnesota center for agriculture education at a 
        reasonable cost to the center to the extent that space is 
        available at the public post-secondary institutions. 
           Subd. 7.  [PURCHASING INSTRUCTIONAL ITEMS.] Technical 
        educational equipment may be procured for programs of the 
        Minnesota center for agriculture education by the council either 
        by brand designation or in accordance with standards and 
        specifications the council may adopt, notwithstanding chapter 
        16B. 
           Sec. 5.  [41D.04] [RESOURCE, MAGNET, AND OUTREACH 
        PROGRAMS.] 
           Subdivision 1.  [RESOURCE AND OUTREACH.] The center shall 
        offer resource and outreach programs and services statewide 
        aimed at the enhancement of agriculture education opportunities 
        for pupils in elementary and secondary school. 
           Subd. 2.  [CENTER RESPONSIBILITIES.] The center shall: 
           (1) provide information and technical services to 
        agriculture teachers, professional agriculture organizations, 
        school districts, and the department of children, families, and 
        learning; 
           (2) gather and conduct research in agriculture education; 
           (3) design and promote agriculture education opportunities 
        for all Minnesota pupils in elementary and secondary schools; 
        and 
           (4) serve as liaison for the department of children, 
        families, and learning to national organizations for agriculture 
        education. 
           Sec. 6.  Minnesota Statutes 1996, section 125.1385, 
        subdivision 2, is amended to read: 
           Subd. 2.  [COMPENSATION.] State money for faculty exchange 
        programs is to compensate for expenses that are unavoidable and 
        beyond the normal living expenses exchange participants would 
        incur if they were not involved in this exchange.  The state 
        university board of trustees of the Minnesota state colleges and 
        universities, the board of regents, or of the University of 
        Minnesota, and their respective campuses, in conjunction with 
        the participating school districts, must control costs for all 
        participants as much as possible, through means such as 
        arranging housing exchanges, providing campus housing, and 
        providing university, state, or school district cars for 
        transportation.  The boards and campuses may seek other sources 
        of funding to supplement these appropriations, if necessary. 
           Sec. 7.  Minnesota Statutes 1996, section 126.56, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ELIGIBLE STUDENT.] To be eligible for a 
        scholarship, a student shall: 
           (1) be a United States citizen or permanent resident of the 
        United States; 
           (2) be a resident of Minnesota; 
           (3) attend an eligible program; 
           (4) have completed at least one year of secondary school 
        but not have graduated from high school; 
           (5) have earned at least a B average or its equivalent 
        during the semester or quarter prior to application, or have 
        earned at least a B average or its equivalent during the 
        semester or quarter prior to application in the academic subject 
        area applicable to the summer program the student wishes to 
        attend; and 
           (6) demonstrate need for financial assistance; and 
           (7) be 19 years of age or younger. 
           Sec. 8.  Minnesota Statutes 1996, section 126.56, 
        subdivision 4a, is amended to read: 
           Subd. 4a.  [ELIGIBLE PROGRAMS.] A scholarship may be used 
        only for an eligible program.  To be eligible, a program must: 
           (1) provide, as its primary purpose, academic instruction 
        for student enrichment in curricular areas including, but not 
        limited to, communications, humanities, social studies, social 
        science, science, mathematics, art, or foreign languages; 
           (2) not be offered for credit to post-secondary students; 
           (3) not provide remedial instruction; 
           (4) meet any other program requirements established by the 
        state board of education and the higher education services 
        office; and 
           (5) be approved by the commissioner director of the higher 
        education services office.  
           Sec. 9.  Minnesota Statutes 1996, section 126.56, 
        subdivision 7, is amended to read: 
           Subd. 7.  [ADMINISTRATION.] The higher education services 
        office and commissioner shall determine the time and manner for 
        scholarship applications, awards, and program approval. 
           Sec. 10.  Minnesota Statutes 1996, section 135A.052, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [STATEMENT OF MISSIONS.] The legislature 
        recognizes each type of public post-secondary system institution 
        to have a distinctive mission within the overall provision of 
        public higher education in the state and a responsibility to 
        cooperate with the each other systems.  These missions are as 
        follows: 
           (1) the technical college system colleges shall offer 
        vocational training and education to prepare students for 
        skilled occupations that do not require a baccalaureate degree; 
           (2) the community college system colleges shall offer lower 
        division instruction in academic programs, occupational programs 
        in which all credits earned will be accepted for transfer to a 
        baccalaureate degree in the same field of study, and remedial 
        studies, for students transferring to baccalaureate institutions 
        and for those seeking associate degrees; 
           (3) consolidated community technical colleges shall offer 
        the same types of instruction, programs, certificates, diplomas, 
        and degrees as the technical colleges and community colleges 
        offer; 
           (4) the state university system universities shall offer 
        undergraduate and graduate instruction through the master's 
        degree, including specialist certificates, in the liberal arts 
        and sciences and professional education; and 
           (4) (5) the University of Minnesota shall offer 
        undergraduate, graduate, and professional instruction through 
        the doctoral degree, and shall be the primary state supported 
        academic agency for research and extension services. 
           It is part of the mission of each system that within the 
        system's resources the system's governing board and chancellor 
        or president shall endeavor to: 
           (a) prevent the waste or unnecessary spending of public 
        money; 
           (b) use innovative fiscal and human resource practices to 
        manage the state's resources and operate the system as 
        efficiently as possible; 
           (c) coordinate the system's activities wherever appropriate 
        with the activities of the other systems system and governmental 
        agencies; 
           (d) use technology where appropriate to increase system 
        productivity, improve customer service, increase public access 
        to information about the system, and increase public 
        participation in the business of the system; 
           (e) utilize constructive and cooperative labor-management 
        practices to the extent otherwise required by chapters 43A and 
        179A; and 
           (f) recommend to the legislature appropriate changes in law 
        necessary to carry out the mission of the system. 
           Sec. 11.  Minnesota Statutes 1996, section 136A.03, is 
        amended to read: 
           136A.03 [EXECUTIVE OFFICERS; EMPLOYEES.] 
           The director of the higher education services office shall 
        possess the powers and perform the duties as prescribed by the 
        higher education services council and shall serve in the 
        unclassified service of the state civil service.  The director, 
        or the director's designated representative, on behalf of the 
        office is authorized to sign contracts and execute all 
        instruments necessary or appropriate to carry out the purposes 
        of sections 136A.01 to 136A.178 for the office.  The salary of 
        the director shall be established by the higher education 
        services council according to section 15A.081, subdivision 1.  
        The director shall be a person qualified by training or 
        experience in the field of higher education or in financial aid 
        administration.  The director may appoint other professional 
        employees who shall serve in the unclassified service of the 
        state civil service.  All other employees shall be in the 
        classified civil service.  
           An officer or professional employee in the unclassified 
        service as provided in this section is a person who has studied 
        higher education or a related field at the graduate level or has 
        similar experience and who is qualified for a career in 
        financial aid and other aspects of higher education and for 
        activities in keeping with the planning and administrative 
        responsibilities of the office and who is appointed to assume 
        responsibility for administration of educational programs or 
        research in matters of higher education. 
           Sec. 12.  Minnesota Statutes 1996, section 136A.16, 
        subdivision 8, is amended to read: 
           Subd. 8.  Money made available to the office that is not 
        immediately needed for the purposes of sections 136A.15 to 
        136A.1702 may be invested by the office.  The money must be 
        invested in bonds, certificates of indebtedness, and other fixed 
        income securities, except preferred stocks, which are legal 
        investments for the permanent school fund.  The money may also 
        be invested in prime quality commercial paper that is eligible 
        for investment in the state employees retirement fund.  All 
        interest and profits from such investments inure to the benefit 
        of the office or may be pledged for security of bonds issued by 
        the office or its predecessor, the Minnesota higher education 
        coordinating board. 
           Sec. 13.  Minnesota Statutes 1996, section 136A.16, is 
        amended by adding a subdivision to read: 
           Subd. 13.  The office may sue and be sued. 
           Sec. 14.  Minnesota Statutes 1996, section 136A.16, is 
        amended by adding a subdivision to read: 
           Subd. 14.  The office may sell at public or private sale, 
        at the price or prices determined by the office, any note or 
        other instrument or obligation evidencing or securing a loan 
        made by the office or its predecessor, the Minnesota higher 
        education coordinating board. 
           Sec. 15.  Minnesota Statutes 1996, section 136A.16, is 
        amended by adding a subdivision to read: 
           Subd. 15.  The office may obtain municipal bond insurance, 
        letters of credit, surety obligations, or similar agreements 
        from financial institutions. 
           Sec. 16.  Minnesota Statutes 1996, section 136A.171, is 
        amended to read: 
           136A.171 [REVENUE BONDS; ISSUANCE; PROCEEDS.] 
           The higher education services office may issue revenue 
        bonds to obtain funds for loans made in accordance with the 
        provisions of this chapter.  The aggregate amount of revenue 
        bonds, issued directly by the office, outstanding at any one 
        time, not including refunded bonds or otherwise defeased or 
        discharged bonds, shall not exceed $550,000,000.  Proceeds from 
        the issuance of bonds may be held and invested by the office 
        pending disbursement in the form of loans.  All interest and 
        profits from the investments shall inure to the benefit of the 
        office and shall be available to the board office for the same 
        purposes as the proceeds from the sale of revenue bonds 
        including, but not limited to, costs incurred in administering 
        loans under this chapter and loan reserve funds. 
           Sec. 17.  Minnesota Statutes 1996, section 136A.173, 
        subdivision 3, is amended to read: 
           Subd. 3.  The revenue bonds may be issued as serial bonds 
        or as term bonds, or the office, in its discretion, may issue 
        bonds of both types.  The revenue bonds shall be authorized by 
        resolution of the members director of the office and shall bear 
        such date or dates, mature at such time or times, not exceeding 
        50 years from their respective dates, bear interest at such rate 
        or rates, payable at such time or times, be in denominations, be 
        in such form, either coupon or registered, carry such 
        registration privileges, be executed in such manner, be payable 
        in lawful money of the United States of America at such place or 
        places, and be subject to such terms of redemption, as such 
        resolution or resolutions may provide.  The revenue bonds or 
        notes may be sold at public or private sale for such price or 
        prices as the office shall determine.  Pending preparation of 
        the definitive bonds, the office may issue interim receipts or 
        certificates which shall be exchanged for such definite bonds. 
           Sec. 18.  Minnesota Statutes 1996, section 136A.29, 
        subdivision 9, is amended to read: 
           Subd. 9.  The authority is authorized and empowered to 
        issue revenue bonds whose aggregate principal amount at any time 
        shall not exceed $350,000,000 $500,000,000 and to issue notes, 
        bond anticipation notes, and revenue refunding bonds of the 
        authority under the provisions of sections 136A.25 to 136A.42, 
        to provide funds for acquiring, constructing, reconstructing, 
        enlarging, remodeling, renovating, improving, furnishing, or 
        equipping one or more projects or parts thereof. 
           Sec. 19.  Minnesota Statutes 1996, section 136F.28, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] For the purpose of this 
        section, the following terms have the meaning given to them: 
           (a) "Southwest Asia veteran" means a person who:  
           (1) served in the active military service in any branch of 
        the armed forces of the United States any time between August 1, 
        1990, and February 27, 1992; 
           (2) became eligible for the Southwest Asia Service Medal as 
        a result of the service; 
           (3) was a Minnesota resident at the time of induction into 
        the armed forces and for the one year immediately preceding 
        induction; and 
           (4) has been separated or discharged from active military 
        service under conditions other than dishonorable.  
           (b) "Technical college" means a technical college or 
        consolidated community technical college under the governance of 
        the Minnesota state colleges and universities. 
           Sec. 20.  Minnesota Statutes 1996, section 136F.32, is 
        amended to read: 
           136F.32 [DEGREES; DIPLOMAS; CERTIFICATES.] 
           Subdivision 1.  [APPROVAL.] The board may approve awarding 
        of appropriate certificates, diplomas, or degrees to persons who 
        complete a prescribed curriculum. 
           Subd. 2.  [TECHNICAL AND CONSOLIDATED TECHNICAL 
        COLLEGES.] A technical college or consolidated technical 
        community college shall offer students the option of pursuing 
        diplomas and certificates in each technical education program, 
        unless the board determines that this is not practicable for 
        certain programs.  All credits earned for a diploma or 
        certificate shall be applicable toward any available degree in 
        the same program. 
           Sec. 21.  Minnesota Statutes 1996, section 136F.49, is 
        amended to read: 
           136F.49 [LICENSURE.] 
           The board may shall adopt policies for licensure of 
        teaching personnel in technical colleges and for vocational 
        technical instructors teaching outside the Minnesota state 
        colleges and universities system.  The board may establish a 
        processing fee for the issuance, renewal, or extension of a 
        license. 
           Sec. 22.  Minnesota Statutes 1996, section 136F.581, 
        subdivision 2, is amended to read: 
           Subd. 2.  [POLICIES AND PROCEDURES.] The board shall 
        develop policies, and each college and university shall develop 
        procedures, for purchases and contracts that are consistent with 
        subdivision 1.  The policies and procedures shall be developed 
        through the system and campus labor management committees and 
        shall include provisions requiring the system and campuses to 
        determine that they cannot use available staff before 
        contracting with additional outside consultants or services.  In 
        addition, each college and university, in consultation with the 
        system office, shall develop procedures for those purchases and 
        contracts that can be accomplished by a college and university 
        without board approval.  The board policies must allow each 
        college and university the local authority to enter into 
        contracts for construction projects of up to $250,000 and to 
        make other purchases of up to $50,000, without receiving board 
        approval.  The board may allow a college or university local 
        authority to make purchases over $50,000 without receiving board 
        approval. 
           Sec. 23.  Minnesota Statutes 1996, section 136F.72, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ACTIVITY FUNDS.] The board may establish 
        in each state college and university a fund to be known as the 
        activity fund.  The purpose of these funds shall be to provide 
        for the administration of state college and university 
        activities designed for student recreational, social, welfare, 
        and educational pursuits supplemental to the regular curricular 
        offerings.  The activity funds shall encompass accounts for 
        student activities, student health services authorized college 
        and university agencies, authorized auxiliary 
        enterprises, federal, state, and private student loans financial 
        aid, gifts and endowments, and other accounts as the board may 
        prescribe.  
           Sec. 24.  Minnesota Statutes 1996, section 136F.80, is 
        amended to read: 
           136F.80 [GRANTS; GIFTS; BEQUESTS; DEVISES; ENDOWMENTS.] 
           Subdivision 1.  [RECEIPT AND ACCEPTANCE.] The board may 
        apply for, receive, and accept on behalf of the state and for 
        the benefit of any state college or university any grant, gift, 
        bequest, devise, or endowment that any person, firm, 
        corporation, foundation, or association, or government agency 
        may make to the board for the purposes of the state colleges and 
        universities, or any federal, state, or private money made 
        available for the purpose of providing student financial aid at 
        the state colleges and universities.  The board may use any 
        money given to it or to any of the state colleges and 
        universities consistent with the terms and conditions under 
        which the money was received and for the purposes stated.  All 
        moneys received under this subdivision are appropriated to the 
        board for use in the colleges and universities and shall be 
        administered within the college and university activity funds.  
        These moneys shall not be taken into account in determining 
        appropriations or allocations.  All taxes and special 
        assessments constituting a lien on any real property received 
        and accepted by the board under this section shall be paid in 
        full before title is transferred to the state. 
           Subd. 2.  [DEPOSIT OF MONEY.] The board shall provide by 
        policy, in accordance with provisions of chapter 118 118A, for 
        the deposit of all money received or referred to under this 
        section.  Whenever the board shall by resolution determine that 
        there are moneys in the state college or university funds not 
        currently needed, the board may by resolution authorize and 
        direct the president of the college or university to invest a 
        specified amount in securities as are duly authorized as legal 
        investments for savings banks and trust companies.  Securities 
        so purchased shall be deposited and held for the board by any 
        bank or trust company authorized to do a banking business in 
        this state.  Notwithstanding the provisions of chapter 118 118A, 
        the state board of investment may invest assets of the board, 
        colleges, and universities when requested by the board, college, 
        or university. 
           Sec. 25.  [136F.81] [TRANSFER OF GIFTS.] 
           A college or university that receives a gift or bequest 
        that is intended for purposes performed by a foundation approved 
        under section 136F.46 may transfer the money to its foundation, 
        provided the money is used only for public purposes. 
           Sec. 26.  Minnesota Statutes 1996, section 137.022, 
        subdivision 2, is amended to read: 
           Subd. 2.  [INCOME.] The All income from the permanent 
        university fund is appropriated annually to the board of 
        regents.  Authority over this income is vested solely in the 
        board but must be used by the board directly to enhance the 
        mission of the university.  This appropriation of income must 
        not be used to reduce other appropriations made to the board of 
        regents.  The determination of this income shall be based on the 
        procedures detailed in section 11A.16, subdivision 5, or 11A.12, 
        subdivision 2. 
           Sec. 27.  Minnesota Statutes 1996, section 216C.27, 
        subdivision 7, is amended to read: 
           Subd. 7.  [BUILDING EVALUATORS.] The commissioner shall 
        certify evaluators in each county of the state who are qualified 
        to determine the compliance of a residence with applicable 
        energy efficiency standards.  The commissioner shall, by rule 
        pursuant to chapter 14, adopt standards for the certification 
        and performance of evaluators and set a fee for the 
        certification of evaluators which is sufficient to cover the 
        ongoing costs of the program once it is established.  The 
        commissioner shall encourage the certification of existing 
        groups of trained municipal personnel and qualified individuals 
        from community-based organizations and public service 
        organizations.  Each certified evaluator shall, on request of 
        the owner, inspect any residence and report the degree to which 
        it complies with applicable energy efficiency standards 
        established pursuant to subdivision 1.  The inspections shall be 
        made within 30 days of the request.  The commissioner shall 
        enter into an agreement with the department of children, 
        families, and learning board of trustees of the Minnesota state 
        colleges and universities for the provision of evaluator 
        training through at institutions that offer the technical 
        colleges training.  The commissioner may contract with 
        the technical colleges board to reduce the training costs to the 
        students.  The commissioner may eliminate the examination fee 
        for persons seeking upgraded certificates.  The commissioner may 
        also establish requirements for continuing education, periodic 
        recertification, and revocation of certification for evaluators. 
           Sec. 28.  Minnesota Statutes 1996, section 583.22, 
        subdivision 5, is amended to read: 
           Subd. 5.  [DIRECTOR.] "Director" means the director of the 
        agricultural extension service conflict and change center at the 
        University of Minnesota's Humphrey Institute or the director's 
        designee. 
           Sec. 29.  Laws 1986, chapter 398, article 1, section 18, as 
        amended by Laws 1987, chapter 292, section 37; Laws 1989, 
        chapter 350, article 16, section 8; Laws 1990, chapter 525, 
        section 1; Laws 1991, chapter 208, section 2; Laws 1993, First 
        Special Session chapter 2, article 6, section 2; and Laws 1995, 
        chapter 212, article 2, section 11, is amended to read: 
           Sec. 18.  [REPEALER.] 
           Sections 1 to 17 and Minnesota Statutes, section 336.9-501, 
        subsections (6) and (7), and sections 583.284, 583.285, 583.286, 
        and 583.305, are repealed on July 1, 1997 1998. 
           Sec. 30.  Laws 1994, chapter 643, section 19, subdivision 
        9, as amended by Laws 1995, chapter 224, section 124, is amended 
        to read:  
        Subd. 9.  Museum and Center for 
        American Indian History                               1,100,000
        This appropriation is for the board of 
        trustees of the Minnesota state 
        colleges and universities to plan, 
        design, and construct a museum and 
        center for American Indian history and 
        policy.  The facility shall be located 
        at Bemidji State University.  This 
        appropriation is not available unless 
        matched by $1,000,000 from nonpublic 
        sources dollar for dollar to the extent 
        matched by nonstate money, provided 
        that a minimum of $500,000 must be 
        raised from nonstate money.  If more 
        than $1,100,000 is raised from nonstate 
        money, the money may be used to expand 
        the project.  Initiation of the project 
        must begin prior to June 30, 2001.  The 
        board of trustees of the Minnesota 
        state colleges and universities is not 
        required to pay any debt service for 
        this appropriation. 
           Sec. 31.  Laws 1996, chapter 366, section 6, is amended to 
        read: 
           Sec. 6.  [MORATORIUM.] 
           Notwithstanding any law to the contrary, until June 30, 
        1997 1998, an educational institution that was licensed under 
        Minnesota Statutes, chapter 141, on December 31, 1995, must 
        continue to comply with the provisions of that chapter and may 
        not use any of the exemptions available under Minnesota 
        Statutes, section 141.35. 
           Sec. 32.  Laws 1997, chapter 32, is amended by adding a 
        section to read: 
           Sec. 2.  [EFFECTIVE DATE.] 
           This act is effective the day after the final enactment of 
        S. F. No. 1888.  
           Sec. 33.  [STUDENT ORGANIZATIONS.] 
           A campus student association shall not hold a referendum to 
        determine statewide affiliation before May 1, 1998, or before 
        the statewide student associations for the community colleges 
        and technical colleges consolidate, whichever is sooner. 
           Sec. 34.  [MINNESOTA VIRTUAL UNIVERSITY.] 
           Subdivision 1.  [ESTABLISHMENT.] The Minnesota Virtual 
        University is established as a public-private partnership 
        consisting of the University of Minnesota, the Minnesota state 
        colleges and universities, and private colleges and universities 
        to ensure that lifelong learning opportunities are developed and 
        available to Minnesota citizens and businesses.  The Minnesota 
        Virtual University shall establish multiple points of entry for 
        students with immediate access to all instructional, support, 
        and administrative services. 
           Subd. 2.  [COORDINATION.] The University of Minnesota, the 
        Minnesota state colleges and universities, and the private 
        colleges and universities are requested to: 
           (1) oversee the development and implementation of an 
        electronic system that will support immediate access to all 
        instructional, support, and administrative services in a 
        seamless and customer-friendly manner; 
           (2) include private businesses, and other institutions that 
        could support the development of a virtual university; and 
           (3) develop an electronic system supporting student 
        services, including, but not limited to, course catalogs, 
        registration systems, credit banks, and occupation and employer 
        data.  The electronic system shall be designed to integrate with 
        existing and future systems supporting the University of 
        Minnesota, the Minnesota state colleges and universities, and 
        private colleges and universities. 
           Sec. 35.  [MNSCU EXCLUSION.] 
           Notwithstanding any law to the contrary, the Minnesota 
        state colleges and universities are not a state agency for the 
        purposes of laws relating to the office of technology. 
           Sec. 36.  [ROUNDTABLE ON VOCATIONAL TECHNICAL EDUCATION.] 
           Subdivision 1.  [ESTABLISHMENT; MEMBERS.] A roundtable 
        discussion on vocational technical education in the state shall 
        be convened.  The roundtable shall consist of 13 members as 
        follows: 
           (1) the commissioner of the department of children, 
        families, and learning or the commissioner's designee; 
           (2) the chancellor of the Minnesota state colleges and 
        universities or the chancellor's designee; 
           (3) a majority member of the higher education budget 
        division of the senate committee on children, families and 
        learning, appointed by the senate majority leader, and a 
        minority member of the same division appointed by the minority 
        leader; 
           (4) a majority member of the higher education finance 
        division of the education committee of the house, appointed by 
        the speaker of the house, and a minority member of the same 
        division appointed by the minority leader; 
           (5) a member of the state vocational school planning 
        committee, selected by the committee; and 
           (6) the following members, appointed by the governor: 
           (i) one member of the state council on vocational technical 
        education; 
           (ii) a member of private industry who regularly hires 
        graduates of vocational technical education programs; 
           (iii) a secondary vocational technical educator; 
           (iv) a post-secondary faculty member in vocational 
        technical education; 
           (v) a current student in vocational technical education; 
        and 
           (vi) a representative of organized labor. 
           Subd. 2.  [DUTIES.] The roundtable shall make 
        recommendations on strategies needed to effectively provide 
        efficient vocational technical education in Minnesota.  The 
        roundtable shall consider at least the following issues: 
           (1) how counseling at the secondary and post-secondary 
        level could improve student success in job placement; 
           (2) how recruitment efforts by technical colleges could 
        help fill classroom vacancies; 
           (3) how to encourage cooperation with industry in 
        curriculum design, internship development, and projection of 
        potential job growth areas; and 
           (4) the relationship of technical colleges to current 
        school-to-work programs. 
           Subd. 3.  [REPORTS.] The roundtable shall report to the 
        legislature on its recommendations by January 15, 1998.  The 
        state council on vocational technical education and the 
        Minnesota state colleges and universities shall provide staffing 
        and other necessary support to the roundtable. 
           Subd. 4.  [PLANNING COMMITTEE; CONTINUATION.] The state 
        vocational school planning committee, established under Laws 
        1995, First Special Session chapter 3, article 3, section 12, 
        shall continue until June 30, 1998. 
           Sec. 37.  [BOARD AUTHORITY TO PURCHASE, SELL, TRANSFER, 
        LEASE, AND CONVEY CERTAIN LAND AND IMPROVEMENTS.] 
           Subdivision 1.  [AUTHORITY.] The board of trustees may 
        purchase, sell, transfer, lease, and convey land and 
        improvements described in this section, and may retain all 
        proceeds from the sale or lease of real estate under Minnesota 
        Statutes, section 136F.71.  The provisions of Minnesota 
        Statutes, sections 94.09 to 94.16 and 103F.535, do not apply to 
        real estate transactions authorized by this section. 
           Subd. 2.  [ST. CLOUD.] The board of trustees may purchase 
        fee title from the Central Minnesota Council of Boy Scouts, 
        Inc., of approximately 1.4 acres of land that includes an office 
        building and that is contiguous to St. Cloud Technical College 
        for college operations. 
           Subd. 3.  [INVER HILLS; NORMANDALE LAND TRANSFERS.] (a) The 
        board of trustees may transfer fee title to approximately eight 
        acres of state-owned real estate operated by Inver Hills 
        Community College to the city of Inver Grove Heights.  The 
        purpose of the transfer is to provide land for the construction 
        of a community library at no cost to the state, the board, or 
        Inver Hills Community College.  In the event that the property 
        is no longer used for public purposes, title to the land shall 
        revert to the state.  The transfer is contingent on the board of 
        trustees acquiring fee title to approximately eight acres of 
        real estate owned by the city of Inver Grove Heights, adjacent 
        to Inver Hills Community College, for college operations. 
           (b) The board of trustees may transfer fee title to 
        approximately 12 acres of state-owned real estate that comprises 
        Normandale Community College's athletic fields to the city of 
        Bloomington.  In the event that the property is no longer used 
        for public purposes, title to the land shall revert to the 
        state.  The transfer is contingent on the board acquiring fee 
        title to approximately 12 acres of real estate owned by the city 
        of Bloomington, which is in the vicinity of Normandale Community 
        College, for college operations.  The land acquired by the 
        college must remain undeveloped.  The transfer must include 
        provisions to allow the college continued use of the fields. 
           Subd. 4.  [WINONA, JACKSON, MAHTOMEDI PROPERTY SALE.] (a) 
        The board of trustees may sell the state's interest in an 
        aviation hangar and related land operated by the Winona campus 
        of Winona-Red Wing Technical College for no less than the 
        assessed value of the property.  The sale may be by public 
        auction, sealed bid, listing with a real estate broker licensed 
        under Minnesota Statutes, chapter 82, or other means selected by 
        the board of trustees. 
           (b) The board of trustees may sell a former armory building 
        operated by the Jackson campus of Minnesota West Community and 
        Technical College for no less than the assessed value of the 
        property.  The sale may be by public auction, sealed bid, 
        listing with a real estate broker licensed under Minnesota 
        Statutes, chapter 82, or other means selected by the board of 
        trustees. 
           (c) The board of trustees may sell or lease for $1 
        state-owned real estate operated by Century Community and 
        Technical College to the city of Mahtomedi for construction of 
        an ice arena.  Additional terms may be set by the board.  The 
        board shall ensure adequate future educational development space 
        is maintained on the east campus and shall give priority to 
        other state-owned land operated by Century Community and 
        Technical College.  Any sale or lease must include provisions 
        for use of the facility by the college.  If the land is sold and 
        later is no longer used for city recreational purposes, the 
        property shall revert to the state.  Prior to any negotiations 
        with the city of Mahtomedi, the chancellor must report to the 
        chairs of the house and senate education committees on the 
        relationship of the ice arena to the long-term educational and 
        facility development goals of the college. 
           Subd. 5.  [MINNEAPOLIS TRANSFER.] Notwithstanding the 
        provisions of Minnesota Statutes, chapter 94, or any other state 
        law, if the board of trustees of the Minnesota state colleges 
        and universities system or the school board of special school 
        district No. 1, Minneapolis, ceases to use its portion of the 
        real property along Second Avenue North adjacent to Bassett's 
        creek in Minneapolis known as the transportation center for a 
        purpose related to normal, authorized board functions or 
        activities, or if the board of trustees or the school board 
        wishes to permanently abandon, sell, or lease or otherwise 
        transfer the control of a material part of its portion of the 
        real property, the board of trustees must offer to convey its 
        portion of the property to the school board for $1 or the school 
        board must offer to convey its portion of the property to the 
        board of trustees for $1.  The board of trustees and the school 
        board are each authorized to convey their portion of the 
        property upon timely acceptance of such offer.  An offer 
        extended shall become void if not accepted in writing within 60 
        days of issuance. 
           Subd. 6.  [MANKATO STATE.] The board of trustees of the 
        Minnesota state colleges and universities may accept money from 
        the Mankato State University Foundation to construct a black box 
        theater on the Mankato State University campus.  The board shall 
        supervise the construction as provided in Minnesota Statutes, 
        section 136F.64. 
           Subd. 7.  [ST. CLOUD STATE UNIVERSITY.] The board of 
        trustees of the Minnesota state colleges and universities may 
        build a bus stop structure with some retail services on the 
        campus of St. Cloud State University.  It is intended that no 
        appropriation for this specific purpose is needed or obligated 
        by this authorization.  An operating agreement may be executed 
        for a period of five to 25 years subject to the requirements of 
        Minnesota Statutes, section 16B.24, subdivision 5. 
           Subd. 8.  [NORTH HENNEPIN COMMUNITY 
        COLLEGE.] Notwithstanding Minnesota Statutes, section 16B.26, 
        the board of trustees may grant permanent utility, drainage, and 
        access easements at North Hennepin Community College, in a form 
        prescribed by the attorney general. 
           Sec. 38.  [INSTRUCTION TO REVISOR.] 
           The revisor of statutes shall change the phrases "state 
        board of technical colleges," "state board for vocational 
        technical education," "state board for community colleges," and 
        "state university board," or similar, to "board of trustees of 
        the Minnesota state colleges and universities" in Minnesota 
        Statutes, sections 3.754; 16A.662, subdivision 5; 352.01, 
        subdivision 2b; and 354.66, subdivision 1a. 
           Sec. 39.  [REPEALER.] 
           Minnesota Statutes 1996, sections 126.113; and 137.41; Laws 
        1995, chapter 212, article 4, section 34; and Laws 1995, First 
        Special Session chapter 2, article 1, sections 35 and 36, are 
        repealed. 
           Sec. 40.  [EFFECTIVE DATES.] 
           Sections 21, 29, and 31 are effective the day following 
        final enactment. 
           Presented to the governor May 19, 1997 
           Signed by the governor May 20, 1997, 2:40 p.m.

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