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CHAPTER 116--H.F.No. 630
An act
relating to education; providing funding and policy for early childhood and
family, prekindergarten through grade 12, and adult education, including general
education, student accountability, education excellence, charter schools, special
education, facilities, technology, nutrition, libraries, accounting, early childhood,
self-sufficiency, lifelong learning, state agencies, and forecast adjustments;
authorizing rulemaking; requiring reports; appropriating money;amending
Minnesota Statutes 2012, sections 15.059, subdivision 5b; 120A.20, subdivision
1; 120A.22, subdivisions 5, 8, 11, 12; 120A.24, subdivision 1; 120A.41;
120B.02; 120B.021, subdivision 1; 120B.023; 120B.024; 120B.11; 120B.125;
120B.128; 120B.15; 120B.30, subdivisions 1, 1a; 120B.31, subdivision 1;
120B.35, subdivision 3; 120B.36, subdivision 1; 121A.22, subdivision 2;
121A.2205; 121A.39; 122A.09, subdivision 4; 122A.18, subdivision 2; 122A.23,
subdivision 2; 122A.28, subdivision 1; 122A.33, subdivision 3; 122A.40,
subdivision 8; 122A.41, subdivision 5; 122A.415, by adding subdivisions;
122A.61, subdivision 1; 123A.73, subdivisions 3, 4, 5; 123B.41, subdivision 7;
123B.42, subdivision 3; 123B.53, subdivision 5; 123B.54; 123B.57, subdivision
4; 123B.591, subdivisions 2, 3; 123B.75, subdivision 5; 123B.88, subdivision
22; 123B.92, subdivisions 1, 5, 9; 124D.02, subdivision 1; 124D.03, subdivision
12; 124D.095, subdivision 10; 124D.10; 124D.11, subdivisions 1, 2, 4, 5;
124D.111, subdivision 1; 124D.119; 124D.122; 124D.128, subdivision 2;
124D.42; 124D.4531; 124D.52, by adding a subdivision; 124D.531, subdivision
1; 124D.65, subdivision 5; 124D.79, subdivision 1, by adding a subdivision;
125A.0941; 125A.0942; 125A.11, subdivision 1; 125A.27, subdivisions 8, 11,
14; 125A.28; 125A.29; 125A.30; 125A.32; 125A.33; 125A.35, subdivision 1;
125A.36; 125A.43; 125A.76, subdivisions 1, 4a, 8, by adding subdivisions;
125A.78, subdivision 2; 125A.79, subdivisions 1, 5, 8; 125B.26, subdivision 4;
126C.05, subdivisions 1, 5, 6, 15; 126C.10, subdivisions 1, 2, 2a, 2b, 2c, 3, 7,
8, 13, 13a, 14, 18, 24, 29, 31, 32, 34, 35, 36, by adding subdivisions; 126C.12,
subdivisions 1, 5; 126C.126; 126C.13, subdivision 4, by adding subdivisions;
126C.15, subdivisions 1, 2; 126C.17; 126C.20; 126C.40, subdivisions 1, 6;
126C.44; 127A.45, subdivisions 12a, 13; 127A.47, subdivisions 7, 8; 127A.51;
128D.11, subdivision 3; 134.32; 134.34; 134.351, subdivisions 3, 7; 134.353;
134.354; 134.355, subdivisions 1, 2, 3, 4, 5, 6; 134.36; 260A.02, subdivision
3; 260A.03; 260A.05, subdivision 1; 260A.07, subdivision 1; 260C.007,
subdivision 19; Laws 2007, chapter 146, article 4, section 12; Laws 2011, First
Special Session chapter 11, article 1, section 36, subdivisions 2, as amended, 3,
as amended, 4, as amended, 5, as amended, 6, as amended, 7, as amended, 10, as
amended; article 2, section 50, subdivisions 2, as amended, 4, as amended, 5, as
amended, 6, as amended, 7, as amended, 9, as amended; article 3, section 11,
subdivisions 2, as amended, 3, as amended, 4, as amended, 5, as amended; article
4, section 10, subdivisions 2, as amended, 3, as amended, 4, as amended, 6, as
amended; article 5, section 12, subdivisions 2, as amended, 3, as amended, 4,
as amended; article 6, section 2, subdivisions 2, as amended, 3, as amended, 5,
as amended; article 7, section 2, subdivisions 2, as amended, 3, as amended, 4,
as amended, 8, as amended; article 8, section 2, subdivisions 2, as amended, 3,
as amended; article 9, section 3, subdivision 2, as amended; proposing coding
for new law in Minnesota Statutes, chapters 120B; 121A; 124D; proposing
coding for new law as Minnesota Statutes, chapter 16F; repealing Minnesota
Statutes 2012, sections 120B.08; 120B.09; 123B.75, subdivision 6a; 124D.454,
subdivisions 3, 10, 11; 125A.35, subdivisions 4, 5; 125A.76, subdivisions 2, 4,
5, 7; 125A.79, subdivisions 6, 7; 126C.10, subdivisions 31a, 31b, 31c, 34, 35,
36; 126C.17, subdivision 13; 127A.50, subdivisions 1, 5; Minnesota Rules,
parts 3501.0010; 3501.0020; 3501.0030, subparts 1, 2, 3, 4, 5, 6, 7, 9, 10, 11,
12, 13, 14, 15, 16; 3501.0040; 3501.0050; 3501.0060; 3501.0090; 3501.0100;
3501.0110; 3501.0120; 3501.0130; 3501.0140; 3501.0150; 3501.0160;
3501.0170; 3501.0180; 3501.0200; 3501.0210; 3501.0220; 3501.0230;
3501.0240; 3501.0250; 3501.0270; 3501.0280, subparts 1, 2; 3501.0290;
3501.0505; 3501.0510; 3501.0515; 3501.0520; 3501.0525; 3501.0530;
3501.0535; 3501.0540; 3501.0545; 3501.0550; 3501.1000; 3501.1020;
3501.1030; 3501.1040; 3501.1050; 3501.1110; 3501.1120; 3501.1130;
3501.1140; 3501.1150; 3501.1160; 3501.1170; 3501.1180; 3501.1190.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1
GENERAL EDUCATION

    Section 1. Minnesota Statutes 2012, section 120A.20, subdivision 1, is amended to read:
    Subdivision 1. Age limitations; pupils. (a) All schools supported in whole or
in part by state funds are public schools. Admission to a public school is free to any
person who: (1) resides within the district that operates the school; (2) is under 21 years of
age or who meets the requirements of paragraph (c); and (3) satisfies the minimum age
requirements imposed by this section. Notwithstanding the provisions of any law to the
contrary, the conduct of all students under 21 years of age attending a public secondary
school is governed by a single set of reasonable rules and regulations promulgated by the
school board.
(b) A person shall not be admitted to a public school (1) as a kindergarten pupil,
unless the pupil is at least five years of age on September 1 of the calendar year in which
the school year for which the pupil seeks admission commences; or (2) as a 1st grade
student, unless the pupil is at least six years of age on September 1 of the calendar year in
which the school year for which the pupil seeks admission commences or has completed
kindergarten; except that any school board may establish a policy for admission of
selected pupils at an earlier age under section 124D.02.
(c) A pupil who becomes age 21 after enrollment is eligible for continued free public
school enrollment until at least one of the following occurs: (1) the first September 1 after
the pupil's 21st birthday; (2) the pupil's completion of the graduation requirements; (3)
the pupil's withdrawal with no subsequent enrollment within 21 calendar days; or (4)
the end of the school year.

    Sec. 2. Minnesota Statutes 2012, section 120A.41, is amended to read:
120A.41 LENGTH OF SCHOOL YEAR; HOURS OF INSTRUCTION.
A school board's annual school calendar must include at least 425 hours of
instruction for a kindergarten student without a disability, 935 hours of instruction for a
student in grades 1 though 6, and 1,020 hours of instruction for a student in grades 7
though 12, not including summer school. Nothing in this section permits a school district
to adopt The school calendar for all-day kindergarten must include at least 850 hours of
instruction for the school year. A school board's annual calendar must include at least 165
days of instruction for a student in grades 1 through 11 unless a four-day week schedule
unless has been approved by the commissioner under section 124D.126.

    Sec. 3. Minnesota Statutes 2012, section 123A.73, subdivision 3, is amended to read:
    Subd. 3. Voluntary dissolution; referendum revenue. As of the effective date of
the voluntary dissolution of a district and its attachment to one or more existing districts
pursuant to section 123A.46, the authorization for all referendum revenues previously
approved by the voters of all affected districts for those districts pursuant to section
126C.17, subdivision 9, or its predecessor provision, is canceled. However, if all of the
territory of any independent district is included in the enlarged district, and if the adjusted
net tax capacity of taxable property in that territory comprises 90 percent or more of
the adjusted net tax capacity of all taxable property in an enlarged district, the enlarged
district's referendum revenue shall be determined as follows:
The referendum revenue shall be the revenue per resident marginal cost adjusted
pupil unit times the number of resident marginal cost adjusted pupil units in the enlarged
district. Any new referendum revenue shall be authorized only after approval is granted
by the voters of the entire enlarged district in an election pursuant to section 126C.17,
subdivision 9
.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 4. Minnesota Statutes 2012, section 123A.73, subdivision 4, is amended to read:
    Subd. 4. Consolidation; maximum authorized referendum revenues. (a) As
of the effective date of a consolidation pursuant to section 123A.48, if the plan for
consolidation so provides, or if the plan for consolidation makes no provision concerning
referendum revenues, the authorization for all referendum revenues previously approved
by the voters of all affected districts for those districts pursuant to section 126C.17,
subdivision 9
, or its predecessor provision shall be recalculated as provided in this
subdivision. The referendum revenue authorization for the newly created district shall
be the revenue per resident marginal cost adjusted pupil unit that would raise an amount
equal to the combined dollar amount of the referendum revenues authorized by each of
the component districts for the year preceding the consolidation, unless the referendum
revenue authorization of the newly created district is subsequently modified pursuant to
section 126C.17, subdivision 9.
(b) The referendum allowance for a consolidated district in the years following
consolidation equals the average of the consolidating districts' existing authorities for those
years, weighted by the districts' resident marginal cost adjusted pupil units in the year
preceding consolidation. For purposes of this calculation, the referendum authorities used
for individual districts shall not decrease from year to year until such time as all existing
authorities for all the consolidating districts have fully expired, but shall increase if they
were originally approved with consumer price index-based or other annual increases.
(c) The referendum revenue authorization for the newly created district shall continue
for a period of time equal to the longest period authorized for any component district.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 5. Minnesota Statutes 2012, section 123A.73, subdivision 5, is amended to read:
    Subd. 5. Alternative method. (a) As of the effective date of a consolidation
pursuant to section 123A.48, if the plan for consolidation so provides, the authorization
for all referendum revenues previously approved by the voters of all affected districts for
those districts pursuant to section 126C.17, subdivision 9, or its predecessor provision
shall be combined as provided in this subdivision. The referendum revenue authorization
for the newly created district may be any allowance per resident marginal cost adjusted
pupil unit provided in the plan for consolidation, but may not exceed the allowance
per resident marginal cost adjusted pupil unit that would raise an amount equal to the
combined dollar amount of the referendum revenues authorized by each of the component
districts for the year preceding the consolidation.
(b) The referendum allowance for a consolidated district in the years following
consolidation equals the average of the consolidating districts' existing authorities for those
years, weighted by the districts' resident marginal cost adjusted pupil units in the year
preceding consolidation. For purposes of this calculation, the referendum authorities used
for individual districts shall not decrease from year to year until such time as all existing
authorities for all the consolidating districts have fully expired, but shall increase if they
were originally approved with consumer price index-based or other annual increases.
(c) The referendum revenue authorization for the newly created district shall
continue for a period of time equal to the longest period authorized for any component
district. The referendum revenue authorization for the newly created district may be
modified pursuant to section 126C.17, subdivision 9.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 6. Minnesota Statutes 2012, section 123B.41, subdivision 7, is amended to read:
    Subd. 7. Elementary pupils. "Elementary pupils" means pupils in grades
kindergarten through 6; provided, each kindergarten pupil in a half-day program shall be
counted as one-half pupil for all computations pursuant to sections 123B.40 to 123B.42,
and 123B.44 to 123B.48.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 7. Minnesota Statutes 2012, section 123B.42, subdivision 3, is amended to read:
    Subd. 3. Cost; limitation. (a) The cost per pupil of the textbooks, individualized
instructional or cooperative learning materials, software or other educational technology,
and standardized tests provided for in this section for each school year must not exceed the
statewide average expenditure per pupil, adjusted pursuant to clause (b), by the Minnesota
public elementary and secondary schools for textbooks, individualized instructional
materials and standardized tests as computed and established by the department by February
1 of the preceding school year from the most recent public school year data then available.
(b) The cost computed in clause (a) shall be increased by an inflation adjustment
equal to the percent of increase in the formula allowance, pursuant to section 126C.10,
subdivision 2
, from the second preceding school year to the current school year.
Notwithstanding the amount of the formula allowance for fiscal years 2015 and 2016 in
section 126C.10, subdivision 2, the commissioner shall use the amount of the formula
allowance for the current year minus $414 in determining the inflation adjustment for
fiscal years 2015 and 2016.
(c) The commissioner shall allot to the districts or intermediary service areas the
total cost for each school year of providing or loaning the textbooks, individualized
instructional or cooperative learning materials, software or other educational technology,
and standardized tests for the pupils in each nonpublic school. The allotment shall not
exceed the product of the statewide average expenditure per pupil, according to clause
(a), adjusted pursuant to clause (b), multiplied by the number of nonpublic school pupils
who make requests pursuant to this section and who are enrolled as of September 15 of
the current school year.

    Sec. 8. Minnesota Statutes 2012, section 123B.88, subdivision 22, is amended to read:
    Subd. 22. Postsecondary enrollment options pupils. Districts may provide bus
transportation along school bus routes when space is available, for pupils attending
programs at a postsecondary institution under the postsecondary enrollment options
program. The transportation is permitted only if it does not increase the district's
expenditures for transportation. Fees collected for this service under section 123B.36,
subdivision 1
, paragraph (13), shall be subtracted from the authorized cost for nonregular
transportation for the purpose of section 123B.92. A school district may provide
transportation for a pupil participating in an articulated program operated under an
agreement between the school district and the postsecondary institution.

    Sec. 9. Minnesota Statutes 2012, section 123B.92, subdivision 1, is amended to read:
    Subdivision 1. Definitions. For purposes of this section and section 125A.76, the
terms defined in this subdivision have the meanings given to them.
    (a) "Actual expenditure per pupil transported in the regular and excess transportation
categories" means the quotient obtained by dividing:
    (1) the sum of:
    (i) all expenditures for transportation in the regular category, as defined in paragraph
(b), clause (1), and the excess category, as defined in paragraph (b), clause (2), plus
    (ii) an amount equal to one year's depreciation on the district's school bus fleet
and mobile units computed on a straight line basis at the rate of 15 percent per year for
districts operating a program under section 124D.128 for grades 1 to 12 for all students in
the district and 12-1/2 percent per year for other districts of the cost of the fleet, plus
    (iii) an amount equal to one year's depreciation on the district's type III vehicles, as
defined in section 169.011, subdivision 71, which must be used a majority of the time for
pupil transportation purposes, computed on a straight line basis at the rate of 20 percent
per year of the cost of the type three school buses by:
    (2) the number of pupils eligible for transportation in the regular category, as defined
in paragraph (b), clause (1), and the excess category, as defined in paragraph (b), clause (2).
    (b) "Transportation category" means a category of transportation service provided to
pupils as follows:
    (1) Regular transportation is:
    (i) transportation to and from school during the regular school year for resident
elementary pupils residing one mile or more from the public or nonpublic school they
attend, and resident secondary pupils residing two miles or more from the public
or nonpublic school they attend, excluding desegregation transportation and noon
kindergarten transportation; but with respect to transportation of pupils to and from
nonpublic schools, only to the extent permitted by sections 123B.84 to 123B.87;
    (ii) transportation of resident pupils to and from language immersion programs;
    (iii) transportation of a pupil who is a custodial parent and that pupil's child between
the pupil's home and the child care provider and between the provider and the school, if
the home and provider are within the attendance area of the school;
    (iv) transportation to and from or board and lodging in another district, of resident
pupils of a district without a secondary school; and
    (v) transportation to and from school during the regular school year required under
subdivision 3 for nonresident elementary pupils when the distance from the attendance
area border to the public school is one mile or more, and for nonresident secondary pupils
when the distance from the attendance area border to the public school is two miles or
more, excluding desegregation transportation and noon kindergarten transportation.
    For the purposes of this paragraph, a district may designate a licensed day care facility,
school day care facility, respite care facility, the residence of a relative, or the residence
of a person or other location chosen by the pupil's parent or guardian, or an after-school
program for children operated by a political subdivision of the state, as the home of a pupil
for part or all of the day, if requested by the pupil's parent or guardian, and if that facility,
residence, or program is within the attendance area of the school the pupil attends.
    (2) Excess transportation is:
    (i) transportation to and from school during the regular school year for resident
secondary pupils residing at least one mile but less than two miles from the public or
nonpublic school they attend, and transportation to and from school for resident pupils
residing less than one mile from school who are transported because of full-service school
zones, extraordinary traffic, drug, or crime hazards; and
    (ii) transportation to and from school during the regular school year required under
subdivision 3 for nonresident secondary pupils when the distance from the attendance area
border to the school is at least one mile but less than two miles from the public school
they attend, and for nonresident pupils when the distance from the attendance area border
to the school is less than one mile from the school and who are transported because of
full-service school zones, extraordinary traffic, drug, or crime hazards.
    (3) Desegregation transportation is transportation within and outside of the district
during the regular school year of pupils to and from schools located outside their normal
attendance areas under a plan for desegregation mandated by the commissioner or under
court order.
    (4) "Transportation services for pupils with disabilities" is:
    (i) transportation of pupils with disabilities who cannot be transported on a regular
school bus between home or a respite care facility and school;
    (ii) necessary transportation of pupils with disabilities from home or from school to
other buildings, including centers such as developmental achievement centers, hospitals,
and treatment centers where special instruction or services required by sections 125A.03
to 125A.24, 125A.26 to 125A.48, and 125A.65 are provided, within or outside the district
where services are provided;
    (iii) necessary transportation for resident pupils with disabilities required by sections
125A.12, and 125A.26 to 125A.48;
    (iv) board and lodging for pupils with disabilities in a district maintaining special
classes;
    (v) transportation from one educational facility to another within the district for
resident pupils enrolled on a shared-time basis in educational programs, and necessary
transportation required by sections 125A.18, and 125A.26 to 125A.48, for resident pupils
with disabilities who are provided special instruction and services on a shared-time basis
or if resident pupils are not transported, the costs of necessary travel between public
and private schools or neutral instructional sites by essential personnel employed by the
district's program for children with a disability;
    (vi) transportation for resident pupils with disabilities to and from board and lodging
facilities when the pupil is boarded and lodged for educational purposes;
(vii) transportation of pupils for a curricular field trip activity on a school bus
equipped with a power lift when the power lift is required by a student's disability or
section 504 plan; and
(viii) services described in clauses (i) to (vii), when provided for pupils with
disabilities in conjunction with a summer instructional program that relates to the
pupil's individualized education program or in conjunction with a learning year program
established under section 124D.128.
    For purposes of computing special education initial aid under section 125A.76,
subdivision 2, the cost of providing transportation for children with disabilities includes
(A) the additional cost of transporting a homeless student from a temporary nonshelter
home in another district to the school of origin, or a formerly homeless student from a
permanent home in another district to the school of origin but only through the end of
the academic year; and (B) depreciation on district-owned school buses purchased after
July 1, 2005, and used primarily for transportation of pupils with disabilities, calculated
according to paragraph (a), clauses (ii) and (iii). Depreciation costs included in the
disabled transportation category must be excluded in calculating the actual expenditure
per pupil transported in the regular and excess transportation categories according to
paragraph (a). For purposes of subitem (A), a school district may transport a child who
does not have a school of origin to the same school attended by that child's sibling, if
the siblings are homeless.
    (5) "Nonpublic nonregular transportation" is:
    (i) transportation from one educational facility to another within the district for
resident pupils enrolled on a shared-time basis in educational programs, excluding
transportation for nonpublic pupils with disabilities under clause (4);
    (ii) transportation within district boundaries between a nonpublic school and a
public school or a neutral site for nonpublic school pupils who are provided pupil support
services pursuant to section 123B.44; and
    (iii) late transportation home from school or between schools within a district for
nonpublic school pupils involved in after-school activities.
    (c) "Mobile unit" means a vehicle or trailer designed to provide facilities for
educational programs and services, including diagnostic testing, guidance and counseling
services, and health services. A mobile unit located off nonpublic school premises is a
neutral site as defined in section 123B.41, subdivision 13.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 10. Minnesota Statutes 2012, section 123B.92, subdivision 5, is amended to read:
    Subd. 5. District reports. (a) Each district must report data to the department as
required by the department to account for transportation expenditures.
(b) Salaries and fringe benefits of district employees whose primary duties are
other than transportation, including central office administrators and staff, building
administrators and staff, teachers, social workers, school nurses, and instructional aides,
must not be included in a district's transportation expenditures, except that a district may
include salaries and benefits according to paragraph (c) for (1) an employee designated
as the district transportation director, (2) an employee providing direct support to the
transportation director, or (3) an employee providing direct transportation services such as
a bus driver or bus aide.
(c) Salaries and fringe benefits of the district employees listed in paragraph (b),
clauses (1), (2), and (3), who work part time in transportation and part time in other areas
must not be included in a district's transportation expenditures unless the district maintains
documentation of the employee's time spent on pupil transportation matters in the form
and manner prescribed by the department.
(d) A school district that contracts for transportation service may allocate
transportation expense to transportation categories based upon contract rates. Districts
may only allocate transportation expense to transportation categories based upon contract
rates if contract rates are reasonably consistent on a cost-per-hour, cost-per-mile,
cost-per-route, or cost-per-student basis. In order to allocate transportation expense based
upon contract rates, a school district, if audited, must be able to demonstrate to the auditor
that variances in the application of transportation cost basis rates are appropriate.
(e) Pupil transportation expenditures, excluding expenditures for capital outlay,
leased buses, student board and lodging, crossing guards, and aides on buses, must may
be allocated among transportation categories based on cost-per-mile or cost-per-student
regardless of whether the transportation services are provided on district-owned or
contractor-owned school buses. Expenditures for school bus driver salaries and fringe
benefits may either be directly charged to the appropriate transportation category or may
be allocated among transportation categories based on cost-per-mile or cost-per-student.
Expenditures by private contractors or individuals who provide transportation exclusively
in one transportation category must be charged directly to the appropriate transportation
category. Transportation services provided by contractor-owned school bus companies
incorporated under different names but owned by the same individual or group of
individuals must be treated as the same company for cost allocation purposes.
(e) Notwithstanding paragraph (d), districts contracting for transportation services
are exempt from the standard cost allocation method for authorized and nonauthorized
transportation categories if the district: (1) bids its contracts separately for authorized and
nonauthorized transportation categories and for special transportation separate from regular
and excess transportation; (2) receives bids or quotes from more than one vendor for these
transportation categories; and (3) the district's cost-per-mile does not vary more than ten
percent among categories, excluding salaries and fringe benefits of bus aides. If the costs
reported by the district for contractor-owned operations vary by more than ten percent
among categories, the department shall require the district to reallocate its transportation
costs, excluding salaries and fringe benefits of bus aides, among all categories.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2014
and later.

    Sec. 11. Minnesota Statutes 2012, section 123B.92, subdivision 9, is amended to read:
    Subd. 9. Nonpublic pupil transportation aid. (a) A district's nonpublic pupil
transportation aid for the 1996-1997 and later school years for transportation services for
nonpublic school pupils according to sections 123B.88, 123B.84 to 123B.86, and this
section, equals the sum of the amounts computed in paragraphs (b) and (c). This aid does
not limit the obligation to transport pupils under sections 123B.84 to 123B.87.
(b) For regular and excess transportation according to subdivision 1, paragraph (b),
clauses (1) and (2), an amount equal to the product of:
(1) the district's actual expenditure per pupil transported in the regular and excess
transportation categories during the second preceding school year; times
(2) the number of nonpublic school pupils residing in the district who receive regular
or excess transportation service or reimbursement for the current school year; times
(3) the ratio of the formula allowance pursuant to section 126C.10, subdivision 2, for
the current school year to the formula allowance pursuant to section 126C.10, subdivision
2
, for the second preceding school year.
(c) For nonpublic nonregular transportation according to subdivision 1, paragraph
(b), clause (5), an amount equal to the product of:
(1) the district's actual expenditure for nonpublic nonregular transportation during
the second preceding school year; times
(2) the ratio of the formula allowance pursuant to section 126C.10, subdivision 2, for
the current school year to the formula allowance pursuant to section 126C.10, subdivision
2
, for the second preceding school year.
(d) Notwithstanding the amount of the formula allowance for fiscal year 2004
years 2015 and 2016 in section 126C.10, subdivision 2, the commissioner shall use the
amount of the formula allowance for the current year minus $415 $414 in determining
the nonpublic pupil transportation revenue in paragraphs (b) and (c) for fiscal year 2004
years 2015 and 2016.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 12. Minnesota Statutes 2012, section 124D.02, subdivision 1, is amended to read:
    Subdivision 1. Kindergarten instruction. The board may establish and maintain
one or more kindergartens for the instruction of children and after July 1, 1974, shall
provide kindergarten instruction for all eligible children, either in the district or in
another district. All children to be eligible for kindergarten must be at least five years
of age on September 1 of the calendar year in which the school year commences. In
addition all children selected under an early admissions policy established by the school
board may be admitted. If established, a board-adopted early admissions policy must
describe the process and procedures for comprehensive evaluation in cognitive, social,
and emotional developmental domains to help determine the child's ability to meet
kindergarten grade expectations and progress to first grade in the subsequent year. The
comprehensive evaluation must use valid and reliable instrumentation, be aligned with
state kindergarten expectations, and include a parent report and teacher observations of
the child's knowledge, skills, and abilities. The early admissions policy must be made
available to parents in an accessible format and is subject to review by the commissioner
of education. The evaluation is subject to section 127A.41. Nothing in this section
shall prohibit a school district from establishing Head Start, prekindergarten, or nursery
school classes for children below kindergarten age. Any school board with evidence that
providing kindergarten will cause an extraordinary hardship on the school district may
apply to the commissioner of education for an exception.

    Sec. 13. Minnesota Statutes 2012, section 124D.128, subdivision 2, is amended to read:
    Subd. 2. Commissioner designation. (a) A state-approved alternative program
designated by the state must be a site. A state-approved alternative program must provide
services to students who meet the criteria in section 124D.68 and who are enrolled in:
    (1) a district that is served by the state-approved alternative program; or
    (2) a charter school located within the geographic boundaries of a district that is
served by the state-approved alternative program.
    (b) A school district or charter school may be approved biennially by the state to
provide additional instructional programming that results in grade level acceleration. The
program must be designed so that students make grade progress during the school year
and graduate prior to the students' peers.
    (c) (b) To be designated, a district, charter school, or state-approved alternative
program must demonstrate to the commissioner that it will:
    (1) provide a program of instruction that permits pupils to receive instruction
throughout the entire year; and
    (2) develop and maintain a separate record system that, for purposes of section
126C.05, permits identification of membership attributable to pupils participating in the
program. The record system and identification must ensure that the program will not have
the effect of increasing the total average daily membership attributable to an individual
pupil as a result of a learning year program. The record system must include the date the
pupil originally enrolled in a learning year program, the pupil's grade level, the date of
each grade promotion, the average daily membership generated in each grade level, the
number of credits or standards earned, and the number needed to graduate.
    (d) (c) A student who has not completed a school district's graduation requirements
may continue to enroll in courses the student must complete in order to graduate until
the student satisfies the district's graduation requirements or the student is 21 years old,
whichever comes first.

    Sec. 14. Minnesota Statutes 2012, section 124D.4531, is amended to read:
124D.4531 CAREER AND TECHNICAL LEVY REVENUE.
    Subdivision 1. Career and technical levy revenue. (a) A district with a career and
technical program approved under this section for the fiscal year in which the levy is
certified may levy an amount is eligible for career and technical revenue equal to 35 percent
of approved expenditures in the fiscal year in which the levy is certified for the following:
(1) salaries paid to essential, licensed personnel providing direct instructional
services to students in that fiscal year, including extended contracts, for services rendered
in the district's approved career and technical education programs, excluding salaries
reimbursed by another school district under clause (2);
(2) amounts paid to another Minnesota school district for salaries of essential,
licensed personnel providing direct instructional services to students in that fiscal year for
services rendered in the district's approved career and technical education programs;
(2) (3) contracted services provided by a public or private agency other than a
Minnesota school district or cooperative center under subdivision 7;
(3) (4) necessary travel between instructional sites by licensed career and technical
education personnel;
(4) (5) necessary travel by licensed career and technical education personnel for
vocational student organization activities held within the state for instructional purposes;
(5) (6) curriculum development activities that are part of a five-year plan for
improvement based on program assessment;
(6) (7) necessary travel by licensed career and technical education personnel for
noncollegiate credit-bearing professional development; and
(7) (8) specialized vocational instructional supplies.
(b) Up to ten percent of a district's career and technical levy revenue may be spent on
equipment purchases. Districts using the career and technical levy revenue for equipment
purchases must report to the department on the improved learning opportunities for
students that result from the investment in equipment.
(c) The district must recognize the full amount of this levy as revenue for the fiscal
year in which it is certified.
(d) The amount of the levy certified revenue calculated under this subdivision may
not exceed $17,850,000 for taxes payable in 2012, $15,520,000 for taxes payable in 2013,
and $15,393,000 $20,657,000 for taxes payable in 2014.
(e) If the estimated levy revenue exceeds the amount in paragraph (d), the
commissioner must reduce the percentage in paragraph (a), clause (2), until the estimated
levy revenue no longer exceeds the limit in paragraph (d).
    Subd. 1a. Career and technical levy. (a) For fiscal year 2014 only, a district may
levy an amount not more than the product of its career and technical revenue times the
lesser of one or the ratio of its adjusted net tax capacity per adjusted pupil unit in the fiscal
year in which the levy is certified to the career and technical revenue equalizing factor.
The career and technical revenue equalizing factor for fiscal year 2014 equals $7,612.
(b) For fiscal year 2015 and later, a district may levy an amount not more than
the product of its career and technical revenue times the lesser of one or the ratio of its
adjusted net tax capacity per adjusted pupil unit in the fiscal year in which the levy is
certified to the career and technical revenue equalizing factor. The career and technical
revenue equalizing factor for fiscal year 2015 and later equals $7,612.
    Subd. 1b. Career and technical aid. For fiscal year 2014 and later, a district's
career and technical aid equals its career and technical revenue less its career and technical
levy. If the district levy is less than the permitted levy, the district's career and technical
aid shall be reduced proportionately.
    Subd. 2. Allocation from cooperative centers and intermediate districts. For
purposes of this section, a cooperative center or an intermediate district must allocate its
approved expenditures for career and technical education programs among participating
districts.
    Subd. 3. Levy Revenue guarantee. Notwithstanding subdivision 1, paragraph (a),
the career and technical education levy revenue for a district is not less than the lesser of:
(1) the district's career and technical education levy authority revenue for the
previous fiscal year; or
(2) 100 percent of the approved expenditures for career and technical programs
included in subdivision 1, paragraph (b), for the fiscal year in which the levy is certified.
    Subd. 3a. Levy, pay 2012-2014 Revenue adjustments. Notwithstanding
subdivisions 1, 1a, and 3, for taxes payable in 2012 to 2014 only, the department must
calculate the career and technical levy authority revenue for each district according to
Minnesota Statutes 2010, section 124D.4531, and adjust the levy authority revenue for
each district proportionately to meet the statewide levy revenue target under subdivision 1,
paragraph (d). For purposes of calculating the levy revenue guarantee under subdivision
3, the career and technical education levy authority revenue for the previous fiscal year
is the levy authority revenue according to Minnesota Statutes 2010, section 124D.4531,
before adjustments to meet the statewide levy revenue target.
    Subd. 4. District reports. Each district or cooperative center must report data to the
department for all career and technical education programs as required by the department
to implement the career and technical levy revenue formula.
    Subd. 5. Allocation from districts participating in agreements for secondary
education or interdistrict cooperation. For purposes of this section, a district with a
career and technical program approved under this section that participates in an agreement
under section 123A.30 or 123A.32 must allocate its levy revenue authority under this
section among participating districts.
EFFECTIVE DATE.This section is effective for fiscal year 2014 and later.

    Sec. 15. Minnesota Statutes 2012, section 126C.05, subdivision 1, is amended to read:
    Subdivision 1. Pupil unit. Pupil units for each Minnesota resident pupil under the
age of 21 or who meets the requirements of section 120A.20, subdivision 1, paragraph (c),
in average daily membership enrolled in the district of residence, in another district under
sections 123A.05 to 123A.08, 124D.03, 124D.08, or 124D.68; in a charter school under
section 124D.10; or for whom the resident district pays tuition under section 123A.18,
123A.22, 123A.30, 123A.32, 123A.44, 123A.488, 123B.88, subdivision 4, 124D.04,
124D.05, 125A.03 to 125A.24, 125A.51, or 125A.65, shall be counted according to this
subdivision.
    (a) A prekindergarten pupil with a disability who is enrolled in a program approved
by the commissioner and has an individualized education program is counted as the ratio
of the number of hours of assessment and education service to 825 times 1.25 1.0 with a
minimum average daily membership of 0.28, but not more than 1.25 1.0 pupil units.
    (b) A prekindergarten pupil who is assessed but determined not to be disabled is
counted as the ratio of the number of hours of assessment service to 825 times 1.25 1.0.
    (c) A kindergarten pupil with a disability who is enrolled in a program approved
by the commissioner is counted as the ratio of the number of hours of assessment and
education services required in the fiscal year by the pupil's individualized education
program to 875, but not more than one.
    (d) A kindergarten pupil who is not included in paragraph (c) is counted as .612 pupil
units A kindergarten pupil who is not included in paragraph (c) is counted as 1.0 pupil
units if the pupil is enrolled in a free all-day, every day kindergarten program available to
all kindergarten pupils at the pupil's school that meets the minimum hours requirement in
section 120A.41, or is counted as .55 pupil units, if the pupil is not enrolled in a free all-day,
every day kindergarten program available to all kindergarten pupils at the pupil's school.
    (e) A pupil who is in any of grades 1 to 3 6 is counted as 1.115 1.0 pupil units for
fiscal year 2000 and thereafter.
    (f) A pupil who is any of grades 4 to 6 is counted as 1.06 pupil units for fiscal
year 1995 and thereafter.
    (g) A pupil who is in any of grades 7 to 12 is counted as 1.3 1.2 pupil units.
    (h) (g) A pupil who is in the postsecondary enrollment options program is counted
as 1.3 1.2 pupil units.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 16. Minnesota Statutes 2012, section 126C.05, subdivision 5, is amended to read:
    Subd. 5. Adjusted pupil units. (a) Adjusted pupil units for a district or charter
school means the sum of:
(1) the number of pupil units served, according to subdivision 7, plus
(2) pupil units according to subdivision 1 for whom the district or charter school pays
tuition under section 123A.18, 123A.22, 123A.30, 123A.32, 123A.44, 123A.488, 123B.88,
subdivision 4
, 124D.04, 124D.05, 125A.03 to 125A.24, 125A.51, or 125A.65, minus
(3) pupil units according to subdivision 1 for whom the district or charter school
receives tuition under section 123A.18, 123A.22, 123A.30, 123A.32, 123A.44, 123A.488,
123B.88, subdivision 4, 124D.04, 124D.05, 125A.03 to 125A.24, 125A.51, or 125A.65.
(b) Adjusted marginal cost pupil units means the greater of:
(1) the sum of .77 times the pupil units defined in paragraph (a) for the current school
year and .23 times the pupil units defined in paragraph (a) for the previous school year; or
(2) the number of adjusted pupil units defined in paragraph (a) for the current school
year.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 17. Minnesota Statutes 2012, section 126C.05, subdivision 6, is amended to read:
    Subd. 6. Resident pupil units. (a) Resident pupil units for a district means the
number of pupil units according to subdivision 1 residing in the district.
(b) Resident marginal cost pupil units means the greater of:
(1) the sum of .77 times the pupil units defined in paragraph (a) for the current year
and .23 times the pupil units defined in paragraph (a) for the previous school year; or
(2) the number of resident pupil units defined in paragraph (a) for the current school
year.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 18. Minnesota Statutes 2012, section 126C.05, subdivision 15, is amended to read:
    Subd. 15. Learning year pupil units. (a) When a pupil is enrolled in a learning
year program under section 124D.128, an area learning center or an alternative learning
program approved by the commissioner under sections 123A.05 and 123A.06, or a
contract alternative program under section 124D.68, subdivision 3, paragraph (d), or
subdivision 3a, for more than 1,020 hours in a school year for a secondary student, more
than 935 hours in a school year for an elementary student, more than 850 hours in a school
year for a kindergarten student without a disability in an all-day kindergarten program,
or more than 425 hours in a school year for a half-day kindergarten student without a
disability, that pupil may be counted as more than one pupil in average daily membership
for purposes of section 126C.10, subdivision 2a. The amount in excess of one pupil must
be determined by the ratio of the number of hours of instruction provided to that pupil in
excess of: (i) the greater of 1,020 hours or the number of hours required for a full-time
secondary pupil in the district to 1,020 for a secondary pupil; (ii) the greater of 935 hours
or the number of hours required for a full-time elementary pupil in the district to 935 for
an elementary pupil in grades 1 through 6; and (iii) the greater of 425 hours or the number
of hours required for a full-time kindergarten student without a disability in the district to
425 for a kindergarten student without a disability; and (iv) the greater of 425 hours or the
number of hours required for a half-time kindergarten student without a disability in the
district to 425 for a half-day kindergarten student without a disability. Hours that occur
after the close of the instructional year in June shall be attributable to the following fiscal
year. A kindergarten student must not be counted as more than 1.2 pupils in average daily
membership under this subdivision. A student in kindergarten or grades 1 through 12 must
not be counted as more than 1.2 pupils in average daily membership under this subdivision.
(b)(i) To receive general education revenue for a pupil in an area learning center
or alternative learning program that has an independent study component, a district
must meet the requirements in this paragraph. The district must develop, for the pupil,
a continual learning plan consistent with section 124D.128, subdivision 3. Each school
district that has an area learning center or alternative learning program must reserve
revenue in an amount equal to at least 90 percent of the district average general education
revenue per pupil unit, minus an amount equal to the product of the formula allowance
according to section 126C.10, subdivision 2, times .0485 .0466, calculated without basic
skills and transportation sparsity revenue, times the number of pupil units generated by
students attending an area learning center or alternative learning program. The amount of
reserved revenue available under this subdivision may only be spent for program costs
associated with the area learning center or alternative learning program. Basic skills
revenue generated according to section 126C.10, subdivision 4, by pupils attending the
eligible program must be allocated to the program.
(ii) General education revenue for a pupil in a state-approved alternative program
without an independent study component must be prorated for a pupil participating for less
than a full year, or its equivalent. The district must develop a continual learning plan for the
pupil, consistent with section 124D.128, subdivision 3. Each school district that has an area
learning center or alternative learning program must reserve revenue in an amount equal to
at least 90 percent of the district average general education revenue per pupil unit, minus
an amount equal to the product of the formula allowance according to section 126C.10,
subdivision 2
, times .0485 .0466, calculated without basic skills and transportation sparsity
revenue, times the number of pupil units generated by students attending an area learning
center or alternative learning program. The amount of reserved revenue available under this
subdivision may only be spent for program costs associated with the area learning center or
alternative learning program. Basic skills revenue generated according to section 126C.10,
subdivision 4
, by pupils attending the eligible program must be allocated to the program.
(iii) General education revenue for a pupil in a state-approved alternative program
that has an independent study component must be paid for each hour of teacher contact
time and each hour of independent study time completed toward a credit or graduation
standards necessary for graduation. Average daily membership for a pupil shall equal the
number of hours of teacher contact time and independent study time divided by 1,020.
(iv) For a state-approved alternative program having an independent study
component, the commissioner shall require a description of the courses in the program, the
kinds of independent study involved, the expected learning outcomes of the courses, and
the means of measuring student performance against the expected outcomes.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 19. Minnesota Statutes 2012, section 126C.10, subdivision 1, is amended to read:
    Subdivision 1. General education revenue. (a) For fiscal years 2013 and 2014, the
general education revenue for each district equals the sum of the district's basic revenue,
extended time revenue, gifted and talented revenue, small schools revenue, basic skills
revenue, training and experience revenue, secondary sparsity revenue, elementary sparsity
revenue, transportation sparsity revenue, total operating capital revenue, equity revenue,
alternative teacher compensation revenue, and transition revenue.
(b) For fiscal year 2015 and later, the general education revenue for each district
equals the sum of the district's basic revenue, extended time revenue, gifted and talented
revenue, declining enrollment revenue, small schools revenue, basic skills revenue,
secondary sparsity revenue, elementary sparsity revenue, transportation sparsity revenue,
total operating capital revenue, equity revenue, pension adjustment revenue, and transition
revenue.

    Sec. 20. Minnesota Statutes 2012, section 126C.10, subdivision 2, is amended to read:
    Subd. 2. Basic revenue. For fiscal year 2014, the basic revenue for each district
equals the formula allowance times the adjusted marginal cost pupil units for the school
year. The formula allowance for fiscal year 2011 is $5,124. The formula allowance for
fiscal year 2012 is $5,174. For fiscal year 2015 and later, the basic revenue for each district
equals the formula allowance times the adjusted pupil units for the school year. The formula
allowance for fiscal year 2013 and subsequent years is $5,224. The formula allowance for
fiscal year 2014 is $5,302. The formula allowance for fiscal year 2015 and later is $5,806.

    Sec. 21. Minnesota Statutes 2012, section 126C.10, subdivision 2a, is amended to read:
    Subd. 2a. Extended time revenue. (a) A school district's extended time revenue
is equal to the product of $4,601 $5,017 and the sum of the adjusted marginal cost pupil
units of the district for each pupil in average daily membership in excess of 1.0 and less
than 1.2 according to section 126C.05, subdivision 8.
(b) A school district's extended time revenue may be used for extended day
programs, extended week programs, summer school, and other programming authorized
under the learning year program.

    Sec. 22. Minnesota Statutes 2012, section 126C.10, subdivision 2b, is amended to read:
    Subd. 2b. Gifted and talented revenue. Gifted and talented revenue for each
district equals the district's adjusted marginal cost pupil units for that school year times
$12 for fiscal year 2008 and later $13. A school district must reserve gifted and talented
revenue and, consistent with section 120B.15, must spend the revenue only to:
    (1) identify gifted and talented students;
    (2) provide education programs for gifted and talented students; or
    (3) provide staff development to prepare teachers to best meet the unique needs
of gifted and talented students.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 23. Minnesota Statutes 2012, section 126C.10, subdivision 2c, is amended to read:
    Subd. 2c. Small schools revenue. (a) A school district, not including a charter
school, is eligible for small schools revenue equal to the greater of the calculation under
paragraph (b) or (d).
(b) The product of:
(1) $5,224 $544;
(2) the district's adjusted marginal cost pupil units for that year; and
(3) the greater of zero or the ratio of (i) 1,000 960 less the district's adjusted marginal
cost pupil units for that year, to (ii) 1,000; and
(4) 0.10 960.
(c) For the purpose of revenue calculated under paragraph (d), "district" includes a
qualifying high school under subdivision 6 that is located in a district with more than one
qualifying high school under subdivision 6.
(d) The product of:
(1) $544;
(2) the district's adjusted pupil units for that year; and
(3) the greater of zero or the ratio of (i) 960 less the district's adjusted pupil units
for that year, to (ii) 960.
EFFECTIVE DATE.This section is effective for revenue in fiscal year 2015 and
later.

    Sec. 24. Minnesota Statutes 2012, section 126C.10, is amended by adding a
subdivision to read:
    Subd. 2d. Declining enrollment revenue. A school district's declining enrollment
revenue equals the greater of zero or the product of: (1) 28 percent of the formula
allowance for that year and (2) the difference between the adjusted pupil units for the
preceding year and the adjusted pupil units for the current year.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 25. Minnesota Statutes 2012, section 126C.10, subdivision 3, is amended to read:
    Subd. 3. Compensatory education revenue. (a) For fiscal year 2014, the
compensatory education revenue for each building in the district equals the formula
allowance minus $415 times the compensation revenue pupil units computed according
to section 126C.05, subdivision 3. For fiscal year 2015 and later, the compensatory
education revenue for each building in the district equals the formula allowance minus
$839 times the compensation revenue pupil units computed according to section 126C.05,
subdivision 3. Revenue shall be paid to the district and must be allocated according to
section 126C.15, subdivision 2.
(b) When the district contracting with an alternative program under section 124D.69
changes prior to the start of a school year, the compensatory revenue generated by pupils
attending the program shall be paid to the district contracting with the alternative program
for the current school year, and shall not be paid to the district contracting with the
alternative program for the prior school year.
(c) When the fiscal agent district for an area learning center changes prior to the start
of a school year, the compensatory revenue shall be paid to the fiscal agent district for the
current school year, and shall not be paid to the fiscal agent district for the prior school year.

    Sec. 26. Minnesota Statutes 2012, section 126C.10, subdivision 7, is amended to read:
    Subd. 7. Secondary sparsity revenue. (a) A district's secondary sparsity revenue
for a school year equals the sum of the results of the following calculation for each
qualifying high school in the district:
(1) the formula allowance for the school year minus $530, multiplied by
(2) the secondary average daily membership of pupils served in the high school,
multiplied by
(3) the quotient obtained by dividing 400 minus the secondary average daily
membership by 400 plus the secondary daily membership, multiplied by
(4) the lesser of 1.5 or the quotient obtained by dividing the isolation index minus
23 by ten.
(b) A newly formed district that is the result of districts combining under the
cooperation and combination program or consolidating under section 123A.48 must
receive secondary sparsity revenue equal to the greater of: (1) the amount calculated
under paragraph (a) for the combined district; or (2) the sum of the amounts of secondary
sparsity revenue the former districts had in the year prior to consolidation, increased for
any subsequent changes in the secondary sparsity formula.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 27. Minnesota Statutes 2012, section 126C.10, subdivision 8, is amended to read:
    Subd. 8. Elementary sparsity revenue. A district's elementary sparsity revenue
equals the sum of the following amounts for each qualifying elementary school in the
district:
(1) the formula allowance for the year minus $530, multiplied by
(2) the elementary average daily membership of pupils served in the school,
multiplied by
(3) the quotient obtained by dividing 140 minus the elementary average daily
membership by 140 plus the average daily membership.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 28. Minnesota Statutes 2012, section 126C.10, subdivision 13, is amended to read:
    Subd. 13. Total operating capital revenue. (a) Total operating capital revenue for
a district equals the amount determined under paragraph (b) or (c), plus $73 $79 times the
adjusted marginal cost pupil units for the school year. The revenue must be placed in a
reserved account in the general fund and may only be used according to subdivision 14.
(b) Capital revenue for a district equals $100 $109 times the district's maintenance
cost index times its adjusted marginal cost pupil units for the school year.
(c) The revenue for a district that operates a program under section 124D.128, is
increased by an amount equal to $30 $31 times the number of marginal cost adjusted pupil
units served at the site where the program is implemented.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 29. Minnesota Statutes 2012, section 126C.10, subdivision 13a, is amended to read:
    Subd. 13a. Operating capital levy. To obtain operating capital revenue for fiscal
year 2007 2015 and later, a district may levy an amount not more than the product of its
operating capital revenue for the fiscal year times the lesser of one or the ratio of its
adjusted net tax capacity per adjusted marginal cost pupil unit to the operating capital
equalizing factor. The operating capital equalizing factor equals $10,194 $14,500.
EFFECTIVE DATE.This section is effective for fiscal year 2015 and later.

    Sec. 30. Minnesota Statutes 2012, section 126C.10, subdivision 14, is amended to read:
    Subd. 14. Uses of total operating capital revenue. Total operating capital revenue
may be used only for the following purposes:
(1) to acquire land for school purposes;
(2) to acquire or construct buildings for school purposes;
(3) to rent or lease buildings, including the costs of building repair or improvement
that are part of a lease agreement;
(4) to improve and repair school sites and buildings, and equip or reequip school
buildings with permanent attached fixtures, including library media centers;
(5) for a surplus school building that is used substantially for a public nonschool
purpose;
(6) to eliminate barriers or increase access to school buildings by individuals with a
disability;
(7) to bring school buildings into compliance with the State Fire Code adopted
according to chapter 299F;
(8) to remove asbestos from school buildings, encapsulate asbestos, or make
asbestos-related repairs;
(9) to clean up and dispose of polychlorinated biphenyls found in school buildings;
(10) to clean up, remove, dispose of, and make repairs related to storing heating fuel
or transportation fuels such as alcohol, gasoline, fuel oil, and special fuel, as defined
in section 296A.01;
(11) for energy audits for school buildings and to modify buildings if the audit
indicates the cost of the modification can be recovered within ten years;
(12) to improve buildings that are leased according to section 123B.51, subdivision 4;
(13) to pay special assessments levied against school property but not to pay
assessments for service charges;
(14) to pay principal and interest on state loans for energy conservation according to
section 216C.37 or loans made under the Douglas J. Johnson Economic Protection Trust
Fund Act according to sections 298.292 to 298.298;
(15) to purchase or lease interactive telecommunications equipment;
(16) by board resolution, to transfer money into the debt redemption fund to: (i)
pay the amounts needed to meet, when due, principal and interest payments on certain
obligations issued according to chapter 475; or (ii) pay principal and interest on debt
service loans or capital loans according to section 126C.70;
(17) to pay operating capital-related assessments of any entity formed under a
cooperative agreement between two or more districts;
(18) to purchase or lease computers and related materials hardware, software, and
annual licensing fees, copying machines, telecommunications equipment, and other
noninstructional equipment;
(19) to purchase or lease assistive technology or equipment for instructional
programs;
(20) to purchase textbooks as defined in section 123B.41, subdivision 2;
(21) to purchase new and replacement library media resources or technology;
(22) to lease or purchase vehicles;
(23) to purchase or lease telecommunications equipment, computers, and related
equipment for integrated information management systems for:
(i) managing and reporting learner outcome information for all students under a
results-oriented graduation rule;
(ii) managing student assessment, services, and achievement information required
for students with individualized education programs; and
(iii) other classroom information management needs;
(24) to pay personnel costs directly related to the acquisition, operation, and
maintenance of telecommunications systems, computers, related equipment, and network
and applications software; and
(25) to pay the costs directly associated with closing a school facility, including
moving and storage costs.

    Sec. 31. Minnesota Statutes 2012, section 126C.10, subdivision 18, is amended to read:
    Subd. 18. Transportation sparsity revenue allowance. (a) A district's
transportation sparsity allowance equals the greater of zero or the result of the following
computation:
(i) Multiply the formula allowance according to subdivision 2, by .1469 .141.
(ii) Multiply the result in clause (i) by the district's sparsity index raised to the
26/100 power.
(iii) Multiply the result in clause (ii) by the district's density index raised to the
13/100 power.
(iv) Multiply the formula allowance according to subdivision 2, by .0485 .0466.
(v) Subtract the result in clause (iv) from the result in clause (iii).
(b) Transportation sparsity revenue is equal to the transportation sparsity allowance
times the adjusted marginal cost pupil units.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 32. Minnesota Statutes 2012, section 126C.10, subdivision 24, is amended to read:
    Subd. 24. Equity revenue. (a) A school district qualifies for equity revenue if:
    (1) the school district's adjusted marginal cost pupil unit amount of basic revenue,
transition revenue, and referendum revenue is less than the value of the school district at
or immediately above the 95th percentile of school districts in its equity region for those
revenue categories; and
    (2) the school district's administrative offices are not located in a city of the first
class on July 1, 1999.
    (b) Equity revenue for a qualifying district that receives referendum revenue under
section 126C.17, subdivision 4, equals the product of (1) the district's adjusted marginal
cost pupil units for that year; times (2) the sum of (i) $13 $14, plus (ii) $75 $80, times the
school district's equity index computed under subdivision 27.
    (c) Equity revenue for a qualifying district that does not receive referendum revenue
under section 126C.17, subdivision 4, equals the product of the district's adjusted marginal
cost pupil units for that year times $13 $14.
    (d) A school district's equity revenue is increased by the greater of zero or an amount
equal to the district's resident marginal cost pupil units times the difference between ten
percent of the statewide average amount of referendum revenue per resident marginal cost
pupil unit for that year and the district's referendum revenue per resident marginal cost
pupil unit. A school district's revenue under this paragraph must not exceed $100,000 for
that year.
    (e) A school district's equity revenue for a school district located in the metro equity
region equals the amount computed in paragraphs (b), (c), and (d) multiplied by 1.25.
    (f) For fiscal year 2007 and later, notwithstanding paragraph (a), clause (2), A school
district that has per pupil referendum revenue below the 95th percentile qualifies for
district's additional equity revenue equal to $46 equals $50 times its adjusted marginal
cost pupil units.
    (g) A district that does not qualify for revenue under paragraph (f) qualifies for
equity revenue equal to $46 times its adjusted marginal cost pupil units.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 33. Minnesota Statutes 2012, section 126C.10, subdivision 29, is amended to read:
    Subd. 29. Equity levy. To obtain equity revenue for fiscal year 2005 2015 and later,
a district may levy an amount not more than the product of its equity revenue for the
fiscal year times the lesser of one or the ratio of its referendum market value per resident
marginal cost pupil unit to $476,000 $510,000.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 34. Minnesota Statutes 2012, section 126C.10, subdivision 31, is amended to read:
    Subd. 31. Transition revenue. (a) A district's transition allowance equals the sum of
the transition revenue the district would have received for fiscal year 2015 under Minnesota
Statutes 2012, section 126C.10, subdivisions 31, 31a, and 31c, and the greater of zero or
the product of the ratio of the number of adjusted marginal cost pupil units the district
would have counted for fiscal year 2004 under Minnesota Statutes 2002 to the district's
adjusted marginal cost pupil units for fiscal year 2004, times the difference between:
    (1) the lesser sum of:
    (i) the district's general education revenue per adjusted marginal cost pupil unit
for fiscal year 2003 or the amount of general education revenue the district would have
received per adjusted marginal cost pupil unit for fiscal year 2004 2015 according to
Minnesota Statutes 2002, 2012, section 126C.10;
(ii) the integration revenue the district received for fiscal year 2013 under Minnesota
Statutes 2012, section 124D.86;
(iii) the pension adjustment the district would have received for fiscal year 2015
under Minnesota Statutes 2012, section 127A.50;
(iv) the special education aid the district would have received for fiscal year 2015
under Minnesota Statutes 2012, section 125A.76; and
(v) the special education excess cost aid the district would have received for fiscal
year 2015 under Minnesota Statutes 2012, section 125A.79; and
(2) the sum of the district's:
(i) general education revenue for fiscal year 2004 2015 excluding transition revenue
under section 126C.10;
(ii) achievement and integration revenue for fiscal year 2015 under section
124D.862; and
(iii) special education aid for fiscal year 2015 under section 125A.76; and
divided by the number of adjusted marginal cost pupil units the district would have
counted for fiscal year 2004 under Minnesota Statutes 2002 2015.
    (b) A district's transition revenue for fiscal years 2006 through 2009 equals the sum of
the product of the district's transition allowance times the district's adjusted marginal cost
pupil units plus the district's transition for prekindergarten revenue under subdivision 31a.
    (c) (b) A district's transition revenue for fiscal year 2010 2015 and later equals the
sum of the product of the district's transition allowance times the district's adjusted marginal
cost pupil units plus the district's transition for prekindergarten revenue under subdivision
31a plus the district's transition for tuition reciprocity revenue under subdivision 31c.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 35. Minnesota Statutes 2012, section 126C.10, subdivision 32, is amended to read:
    Subd. 32. Transition levy. To obtain transition revenue for fiscal year 2005 2015
and later, a district may levy an amount not more than the product of its transition revenue
for the fiscal year times the lesser of one or the ratio of its referendum market value per
resident marginal cost pupil unit to $476,000 $510,000.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 36. Minnesota Statutes 2012, section 126C.10, subdivision 34, is amended to read:
    Subd. 34. Basic alternative teacher compensation aid. (a) For fiscal years 2007,
2008, and 2009, the basic alternative teacher compensation aid for a school district
with a plan approved under section 122A.414, subdivision 2b, equals 73.1 percent of
the alternative teacher compensation revenue under section 122A.415, subdivision 1.
The basic alternative teacher compensation aid for an intermediate school district or
charter school with a plan approved under section 122A.414, subdivisions 2a and 2b, if
the recipient is a charter school, equals $260 times the number of pupils enrolled in the
school on October 1 of the previous fiscal year, or on October 1 of the current fiscal
year for a charter school in the first year of operation, times the ratio of the sum of the
alternative teacher compensation aid and alternative teacher compensation levy for all
participating school districts to the maximum alternative teacher compensation revenue
for those districts under section 122A.415, subdivision 1.
    (b) For fiscal years 2010 and later 2013 and 2014 only, the basic alternative
teacher compensation aid for a school with a plan approved under section 122A.414,
subdivision 2b
, equals 65 percent of the alternative teacher compensation revenue under
section 122A.415, subdivision 1. The basic alternative teacher compensation aid for
an intermediate school district or charter school with a plan approved under section
122A.414, subdivisions 2a and 2b, if the recipient is a charter school, equals $260 times
the number of pupils enrolled in the school on October 1 of the previous year, or on
October 1 of the current year for a charter school in the first year of operation, times
the ratio of the sum of the alternative teacher compensation aid and alternative teacher
compensation levy for all participating school districts to the maximum alternative teacher
compensation revenue for those districts under section 122A.415, subdivision 1.
(c) (b) Notwithstanding paragraphs paragraph (a) and (b) and section 122A.415,
subdivision 1
, the state total basic alternative teacher compensation aid entitlement must
not exceed $75,636,000 for fiscal year 2007 and later. The commissioner must limit the
amount of alternative teacher compensation aid approved under section 122A.415 so as
not to exceed these limits.

    Sec. 37. Minnesota Statutes 2012, section 126C.10, subdivision 35, is amended to read:
    Subd. 35. Alternative teacher compensation levy. For fiscal year 2007 years 2013
and later 2014 only, the alternative teacher compensation levy for a district receiving basic
alternative teacher compensation aid equals the product of (1) the difference between the
district's alternative teacher compensation revenue and the district's basic alternative
teacher compensation aid times (2) the lesser of one or the ratio of the district's adjusted
net tax capacity per adjusted pupil unit to $5,634.

    Sec. 38. Minnesota Statutes 2012, section 126C.10, subdivision 36, is amended to read:
    Subd. 36. Alternative teacher compensation aid. (a) For fiscal year 2007 years
2013 and later 2014 only, a district's alternative teacher compensation equalization aid
equals the district's alternative teacher compensation revenue minus the district's basic
alternative teacher compensation aid minus the district's alternative teacher compensation
levy. If a district does not levy the entire amount permitted, the alternative teacher
compensation equalization aid must be reduced in proportion to the actual amount levied.
(b) A district's alternative teacher compensation aid equals the sum of the
district's basic alternative teacher compensation aid and the district's alternative teacher
compensation equalization aid.

    Sec. 39. Minnesota Statutes 2012, section 126C.10, is amended by adding a
subdivision to read:
    Subd. 38. Pension adjustment revenue. A school district's pension adjustment
revenue equals the greater of zero or the product of:
(1) the difference between the district's adjustment under Minnesota Statutes 2012,
section 127A.50, subdivision 1, for fiscal year 2014 per adjusted pupil unit and the state
average adjustment under Minnesota Statutes 2012, section 127A.50, subdivision 1, for
fiscal year 2014 per adjusted pupil unit; and
(2) the district's adjusted pupil units for the fiscal year.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 40. Minnesota Statutes 2012, section 126C.12, subdivision 1, is amended to read:
    Subdivision 1. Revenue. Of a district's general education revenue for fiscal year
2000 2015 and thereafter each school district shall reserve an amount equal to the formula
allowance multiplied by the following calculation:
(1) the sum of adjusted marginal cost pupils in average daily membership, according
to section 126C.05, subdivision 5, in kindergarten times .057 $299; plus
(2) the sum of adjusted marginal cost pupils in average daily membership, according
to section 126C.05, subdivision 5, in grades 1 to 3 6 times .115; plus $459.
(3) the sum of adjusted marginal cost pupils in average daily membership, according
to section 126C.05, subdivision 5, in grades 4 to 6 times .06.
EFFECTIVE DATE.This section is effective for fiscal year 2015 and later.

    Sec. 41. Minnesota Statutes 2012, section 126C.12, subdivision 5, is amended to read:
    Subd. 5. Additional revenue use. If the board of a district determines that the
district has achieved and is maintaining the class sizes specified in subdivision 4, the board
may use the revenue to reduce class size in grades 4, 5, and 6, provide all-day, everyday
kindergarten, prepare and use individualized learning plans, improve program offerings,
purchase instructional material, services, or technology, or provide staff development
needed for reduced class sizes.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015.

    Sec. 42. Minnesota Statutes 2012, section 126C.126, is amended to read:
126C.126 USE OF GENERAL EDUCATION REVENUE FOR ALL-DAY
KINDERGARTEN AND PREKINDERGARTEN.
     A school district may spend general education revenue on extended time
kindergarten and prekindergarten programs. At the school board's discretion, the district
may use revenue generated by the all-day kindergarten pupil count under section 126C.05,
subdivision 1, paragraph (d), to meet the needs of three- and four-year-olds in the district.
A school district may not use these funds on programs for three- and four-year-old children
while maintaining a fee-based all-day kindergarten program.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 43. Minnesota Statutes 2012, section 126C.13, is amended by adding a
subdivision to read:
    Subd. 3a. Student achievement rate. The commissioner must establish the student
achievement rate by July 1 of each year for levies payable in the following year. The
student achievement rate must be a rate, rounded up to the nearest hundredth of a percent,
that, when applied to the adjusted net tax capacity for all districts, raises the amount
specified in this subdivision. The student achievement rate must be the rate that raises
$20,000,000 for fiscal year 2015 and later years. The student achievement rate may not
be changed due to changes or corrections made to a district's adjusted net tax capacity
after the rate has been established.

    Sec. 44. Minnesota Statutes 2012, section 126C.13, is amended by adding a
subdivision to read:
    Subd. 3b. Student achievement levy. To obtain general education revenue, a
district may levy an amount not to exceed the student achievement rate times the adjusted
net tax capacity of the district for the preceding year. If the amount of the student
achievement levy would exceed the general education revenue, the student achievement
levy must be determined according to subdivision 3c.

    Sec. 45. Minnesota Statutes 2012, section 126C.13, is amended by adding a
subdivision to read:
    Subd. 3c. Student achievement levy; districts off the formula. (a) If the amount
of the student achievement levy for a district exceeds the district's general education
revenue, excluding operating capital revenue, equity revenue, and transition revenue, the
amount of the student achievement levy must be limited to the district's general education
revenue, excluding operating capital revenue, equity revenue, and transition revenue.
    (b) A levy made according to this subdivision shall also be construed to be the levy
made according to subdivision 3b.

    Sec. 46. Minnesota Statutes 2012, section 126C.13, subdivision 4, is amended to read:
    Subd. 4. General education aid. (a) For fiscal years 2007 2013 and later 2014 only,
a district's general education aid is the sum of the following amounts:
    (1) general education revenue, excluding equity revenue, total operating capital
revenue, alternative teacher compensation revenue, and transition revenue;
    (2) operating capital aid under section 126C.10, subdivision 13b;
    (3) equity aid under section 126C.10, subdivision 30;
    (4) alternative teacher compensation aid under section 126C.10, subdivision 36;
    (5) transition aid under section 126C.10, subdivision 33;
    (6) shared time aid under section 126C.01, subdivision 7;
    (7) referendum aid under section 126C.17, subdivisions 7 and 7a; and
    (8) online learning aid according to section 124D.096.
(b) For fiscal year 2015 and later, a district's general education aid equals:
(1) general education revenue, excluding operating capital revenue, equity revenue,
and transition revenue, minus the student achievement levy, multiplied times the ratio of
the actual amount of student achievement levy levied to the permitted student achievement
levy; plus
(2) equity aid under section 126C.10, subdivision 30; plus
(3) transition aid under section 126C.10, subdivision 33; plus
(4) shared time aid under section 126C.10, subdivision 7; plus
(5) referendum aid under section 126C.17, subdivisions 7 and 7a; plus
(6) online learning aid under section 124D.096.

    Sec. 47. Minnesota Statutes 2012, section 126C.15, subdivision 1, is amended to read:
    Subdivision 1. Use of revenue. The basic skills revenue under section 126C.10,
subdivision 4
, must be reserved and used to meet the educational needs of pupils who
enroll under-prepared to learn and whose progress toward meeting state or local content
or performance standards is below the level that is appropriate for learners of their age.
Basic skills revenue may also be used for programs designed to prepare children and their
families for entry into school whether the student first enrolls in kindergarten or first grade.
Any of the following may be provided to meet these learners' needs:
(1) direct instructional services under the assurance of mastery program according
to section 124D.66;
(2) remedial instruction in reading, language arts, mathematics, other content areas,
or study skills to improve the achievement level of these learners;
(3) additional teachers and teacher aides to provide more individualized instruction
to these learners through individual tutoring, lower instructor-to-learner ratios, or team
teaching;
(4) a longer school day or week during the regular school year or through a summer
program that may be offered directly by the site or under a performance-based contract
with a community-based organization;
(5) comprehensive and ongoing staff development consistent with district and site
plans according to section 122A.60, for teachers, teacher aides, principals, and other
personnel to improve their ability to identify the needs of these learners and provide
appropriate remediation, intervention, accommodations, or modifications;
(6) instructional materials, digital learning, and technology appropriate for meeting
the individual needs of these learners;
(7) programs to reduce truancy, encourage completion of high school, enhance
self-concept, provide health services, provide nutrition services, provide a safe and secure
learning environment, provide coordination for pupils receiving services from other
governmental agencies, provide psychological services to determine the level of social,
emotional, cognitive, and intellectual development, and provide counseling services,
guidance services, and social work services;
(8) bilingual programs, bicultural programs, and programs for English learners;
(9) all day kindergarten;
(10) early education programs, parent-training programs, school readiness programs,
kindergarten programs for four-year-olds, voluntary home visits under section 124D.13,
subdivision 4, and other outreach efforts designed to prepare children for kindergarten;
(11) extended school day and extended school year programs; and
(11) (12) substantial parent involvement in developing and implementing remedial
education or intervention plans for a learner, including learning contracts between the
school, the learner, and the parent that establish achievement goals and responsibilities of
the learner and the learner's parent or guardian.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2014
and later.

    Sec. 48. Minnesota Statutes 2012, section 126C.15, subdivision 2, is amended to read:
    Subd. 2. Building allocation. (a) A district or cooperative must allocate its
compensatory revenue to each school building in the district or cooperative where
the children who have generated the revenue are served unless the school district or
cooperative has received permission under Laws 2005, First Special Session chapter 5,
article 1, section 50, to allocate compensatory revenue according to student performance
measures developed by the school board.
    (b) Notwithstanding paragraph (a), a district or cooperative may allocate up to
five percent of the amount of compensatory revenue that the district receives to school
sites according to a plan adopted by the school board, and a district or cooperative may
allocate up to an additional five percent of its compensatory revenue for activities under
subdivision 1, clause (10), according to a plan adopted by the school board. The money
reallocated under this paragraph must be spent for the purposes listed in subdivision 1, but
may be spent on students in any grade, including students attending school readiness or
other prekindergarten programs.
    (c) For the purposes of this section and section 126C.05, subdivision 3, "building"
means education site as defined in section 123B.04, subdivision 1.
    (d) Notwithstanding section 123A.26, subdivision 1, compensatory revenue
generated by students served at a cooperative unit shall be paid to the cooperative unit.
    (e) A district or cooperative with school building openings, school building
closings, changes in attendance area boundaries, or other changes in programs or student
demographics between the prior year and the current year may reallocate compensatory
revenue among sites to reflect these changes. A district or cooperative must report to the
department any adjustments it makes according to this paragraph and the department must
use the adjusted compensatory revenue allocations in preparing the report required under
section 123B.76, subdivision 3, paragraph (c).
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2014
and later.

    Sec. 49. Minnesota Statutes 2012, section 126C.17, is amended to read:
126C.17 REFERENDUM REVENUE.
    Subdivision 1. Referendum allowance. (a) For fiscal year 2003 and later, a district's
initial referendum revenue allowance equals the sum of the allowance under section
126C.16, subdivision 2, plus any additional allowance per resident marginal cost pupil
unit authorized under subdivision 9 before May 1, 2001, for fiscal year 2002 and later,
plus the referendum conversion allowance approved under subdivision 13, minus $415.
For districts with more than one referendum authority, the reduction must be computed
separately for each authority. The reduction must be applied first to the referendum
conversion allowance and next to the authority with the earliest expiration date. A
district's initial referendum revenue allowance may not be less than zero.
(b) For fiscal year 2003, a district's referendum revenue allowance equals the initial
referendum allowance plus any additional allowance per resident marginal cost pupil unit
authorized under subdivision 9 between April 30, 2001, and December 30, 2001, for
fiscal year 2003 and later.
(c) For fiscal year 2004 and later, a district's referendum revenue allowance equals
the sum of:
(1) the product of (i) the ratio of the resident marginal cost pupil units the district
would have counted for fiscal year 2004 under Minnesota Statutes 2002, section 126C.05,
to the district's resident marginal cost pupil units for fiscal year 2004, times (ii) the initial
referendum allowance plus any additional allowance per resident marginal cost pupil unit
authorized under subdivision 9 between April 30, 2001, and May 30, 2003, for fiscal
year 2003 and later, plus
(2) any additional allowance per resident marginal cost pupil unit authorized under
subdivision 9 after May 30, 2003, for fiscal year 2005 and later.
(a) A district's initial referendum allowance for fiscal year 2015 equals the result of
the following calculations:
(1) multiply the referendum allowance the district would have received for fiscal
year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 1, based on
elections held before July 1, 2013, by the resident marginal cost pupil units the district
would have counted for fiscal year 2015 under Minnesota Statutes 2012, section 126C.05;
(2) add to the result of clause (1) the adjustment the district would have received
under Minnesota Statutes 2012, section 127A.47, subdivision 7, paragraphs (a), (b), and
(c), based on elections held before July 1, 2013;
(3) divide the result of clause (2) by the district's adjusted pupil units for fiscal
year 2015; and
(4) if the result of clause (3) is less than zero, set the allowance to zero.
(b) A district's referendum allowance equals the sum of the district's initial
referendum allowance for fiscal year 2015, plus any additional referendum allowance per
adjusted pupil unit authorized after June 30, 2013, minus any allowances expiring in fiscal
year 2016 or later. For a district with more than one referendum allowance for fiscal year
2015 under Minnesota Statutes 2012, section 126C.17, the allowance calculated under
paragraph (a) must be divided into components such that the same percentage of the
district's allowance expires at the same time as the old allowances would have expired
under Minnesota Statutes 2012, section 126C.17.
    Subd. 2. Referendum allowance limit. (a) Notwithstanding subdivision 1, for fiscal
year 2007 2015 and later, a district's referendum allowance must not exceed the greater of:
(1) the sum of: (i) a district's referendum allowance for fiscal year 1994 times 1.177
times the annual inflationary increase as calculated under paragraph (b) plus (ii) its
referendum conversion allowance for fiscal year 2003, minus (iii) $215;
(2) the greater of (i): 26 percent of the formula allowance or (ii) $1,294 times the
annual inflationary increase as calculated under paragraph (b); or times the greatest of:
(1) $1,845;
(2) the sum of the referendum revenue the district would have received for fiscal
year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 4, based on
elections held before July 1, 2013, and the adjustment the district would have received
under Minnesota Statutes 2012, section 127A.47, subdivision 7, paragraphs (a), (b), and
(c), based on elections held before July 1, 2013, divided by the district's adjusted pupil
units for fiscal year 2015; or
(3) the product of the referendum allowance limit the district would have received
for fiscal year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 2, and
the resident marginal cost pupil units the district would have received for fiscal year 2015
under Minnesota Statutes 2012, section 126C.05, subdivision 6, plus the adjustment the
district would have received under Minnesota Statutes 2012, section 127A.47, subdivision
7, paragraphs (a), (b), and (c), based on elections held before July 1, 2013, divided by
the district's adjusted pupil units for fiscal year 2015; or
(3) (4) for a newly reorganized district created after July 1, 2006 2013, the referendum
revenue authority for each reorganizing district in the year preceding reorganization divided
by its resident marginal cost adjusted pupil units for the year preceding reorganization.
(b) For purposes of this subdivision, for fiscal year 2005 2016 and later, "inflationary
increase" means one plus the percentage change in the Consumer Price Index for urban
consumers, as prepared by the United States Bureau of Labor Standards, for the current
fiscal year to fiscal year 2004 2015. For fiscal years 2009 year 2016 and later, for purposes
of paragraph (a), clause (1) (3), the inflationary increase equals the inflationary increase
for fiscal year 2008 plus one-fourth of the percentage increase in the formula allowance
for that year compared with the formula allowance for fiscal year 2008 2015.
    Subd. 3. Sparsity exception. A district that qualifies for sparsity revenue under
section 126C.10 is not subject to a referendum allowance limit.
    Subd. 4. Total referendum revenue. The total referendum revenue for each district
equals the district's referendum allowance times the resident marginal cost adjusted pupil
units for the school year.
    Subd. 5. Referendum equalization revenue. (a) For fiscal year 2003 and later,
A district's referendum equalization revenue equals the sum of the first tier referendum
equalization revenue and the second tier referendum equalization revenue.
(b) A district's first tier referendum equalization revenue equals the district's first
tier referendum equalization allowance times the district's resident marginal cost adjusted
pupil units for that year.
(c) For fiscal year 2006, a district's first tier referendum equalization allowance
equals the lesser of the district's referendum allowance under subdivision 1 or $500. For
fiscal year 2007, a district's first tier referendum equalization allowance equals the lesser
of the district's referendum allowance under subdivision 1 or $600.
For fiscal year 2008 and later, A district's first tier referendum equalization allowance
equals the lesser of the district's referendum allowance under subdivision 1 or $700 $760.
(d) A district's second tier referendum equalization revenue equals the district's
second tier referendum equalization allowance times the district's resident marginal cost
adjusted pupil units for that year.
(e) For fiscal year 2006, a district's second tier referendum equalization allowance
equals the lesser of the district's referendum allowance under subdivision 1 or 18.6 percent
of the formula allowance, minus the district's first tier referendum equalization allowance.
For fiscal year 2007 and later, A district's second tier referendum equalization allowance
equals the lesser of the district's referendum allowance under subdivision 1 or 26 25 percent
of the formula allowance, minus the district's first tier referendum equalization allowance.
(f) Notwithstanding paragraph (e), the second tier referendum allowance for a
district qualifying for secondary sparsity revenue under section 126C.10, subdivision 7, or
elementary sparsity revenue under section 126C.10, subdivision 8, equals the district's
referendum allowance under subdivision 1 minus the district's first tier referendum
equalization allowance.
    Subd. 6. Referendum equalization levy. (a) For fiscal year 2003 and later,
a district's referendum equalization levy equals the sum of the first tier referendum
equalization levy and the second tier referendum equalization levy.
(b) A district's first tier referendum equalization levy equals the district's first tier
referendum equalization revenue times the lesser of one or the ratio of the district's
referendum market value per resident marginal cost pupil unit to $476,000 $510,000.
(c) A district's second tier referendum equalization levy equals the district's second
tier referendum equalization revenue times the lesser of one or the ratio of the district's
referendum market value per resident marginal cost pupil unit to $270,000 $290,000.
    Subd. 7. Referendum equalization aid. (a) A district's referendum equalization aid
equals the difference between its referendum equalization revenue and levy.
(b) If a district's actual levy for first or second tier referendum equalization revenue
is less than its maximum levy limit for that tier, aid shall be proportionately reduced.
(c) Notwithstanding paragraph (a), the referendum equalization aid for a district,
where the referendum equalization aid under paragraph (a) exceeds 90 percent of the
referendum revenue, must not exceed 26 25 percent of the formula allowance times the
district's resident marginal cost adjusted pupil units. A district's referendum levy is
increased by the amount of any reduction in referendum aid under this paragraph.
    Subd. 7a. Referendum tax base replacement aid. For each school district that
had a referendum allowance for fiscal year 2002 exceeding $415, for each separately
authorized referendum levy, the commissioner of revenue, in consultation with the
commissioner of education, shall certify the amount of the referendum levy in taxes
payable year 2001 attributable to the portion of the referendum allowance exceeding $415
levied against property classified as class 2, noncommercial 4c(1), or 4c(4), under section
273.13, excluding the portion of the tax paid by the portion of class 2a property consisting
of the house, garage, and surrounding one acre of land. The resulting amount must be
used to reduce the district's referendum levy amount otherwise determined, and must be
paid to the district each year that the referendum authority remains in effect, is renewed,
or new referendum authority is approved. The aid payable under this subdivision must
be subtracted from the district's referendum equalization aid under subdivision 7. The
referendum equalization aid after the subtraction must not be less than zero.
    Subd. 7b. Referendum aid guarantee. (a) Notwithstanding subdivision 7, a
district's referendum equalization aid for fiscal year 2015 must not be less than the sum
of the referendum equalization aid the district would have received for fiscal year 2015
under Minnesota Statutes 2012, section 126C.17, subdivision 7, and the adjustment the
district would have received under Minnesota Statutes 2012, section 127A.47, subdivision
7, paragraphs (a), (b), and (c).
(b) Notwithstanding subdivision 7, referendum equalization aid for fiscal year 2016
and later, for a district qualifying for additional aid under paragraph (a) for fiscal year
2015, must not be less than the product of (1) the district's referendum equalization aid
for fiscal year 2015, times (2) the lesser of one or the ratio of the district's referendum
revenue for that school year to the district's referendum revenue for fiscal year 2015, times
(3) the lesser of one or the ratio of the district's referendum market value used for fiscal
year 2015 referendum equalization calculations to the district's referendum market value
used for that year's referendum equalization calculations.
    Subd. 8. Unequalized referendum levy. Each year, a district may levy an amount
equal to the difference between its total referendum revenue according to subdivision 4
and its referendum equalization revenue according to subdivision 5.
    Subd. 9. Referendum revenue. (a) The revenue authorized by section 126C.10,
subdivision 1
, may be increased in the amount approved by the voters of the district
at a referendum called for the purpose. The referendum may be called by the board.
The referendum must be conducted one or two calendar years before the increased levy
authority, if approved, first becomes payable. Only one election to approve an increase
may be held in a calendar year. Unless the referendum is conducted by mail under
subdivision 11, paragraph (a), the referendum must be held on the first Tuesday after the
first Monday in November. The ballot must state the maximum amount of the increased
revenue per resident marginal cost adjusted pupil unit. The ballot may state a schedule,
determined by the board, of increased revenue per resident marginal cost adjusted pupil
unit that differs from year to year over the number of years for which the increased revenue
is authorized or may state that the amount shall increase annually by the rate of inflation.
For this purpose, the rate of inflation shall be the annual inflationary increase calculated
under subdivision 2, paragraph (b). The ballot may state that existing referendum levy
authority is expiring. In this case, the ballot may also compare the proposed levy authority
to the existing expiring levy authority, and express the proposed increase as the amount, if
any, over the expiring referendum levy authority. The ballot must designate the specific
number of years, not to exceed ten, for which the referendum authorization applies. The
ballot, including a ballot on the question to revoke or reduce the increased revenue amount
under paragraph (c), must abbreviate the term "per resident marginal cost adjusted pupil
unit" as "per pupil." The notice required under section 275.60 may be modified to read, in
cases of renewing existing levies at the same amount per pupil as in the previous year:
"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU ARE VOTING
TO EXTEND AN EXISTING PROPERTY TAX REFERENDUM THAT IS
SCHEDULED TO EXPIRE."
    The ballot may contain a textual portion with the information required in this
subdivision and a question stating substantially the following:
    "Shall the increase in the revenue proposed by (petition to) the board of .........,
School District No. .., be approved?"
    If approved, an amount equal to the approved revenue per resident marginal cost
adjusted pupil unit times the resident marginal cost adjusted pupil units for the school
year beginning in the year after the levy is certified shall be authorized for certification
for the number of years approved, if applicable, or until revoked or reduced by the voters
of the district at a subsequent referendum.
    (b) The board must prepare and deliver by first class mail at least 15 days but no more
than 30 days before the day of the referendum to each taxpayer a notice of the referendum
and the proposed revenue increase. The board need not mail more than one notice to any
taxpayer. For the purpose of giving mailed notice under this subdivision, owners must be
those shown to be owners on the records of the county auditor or, in any county where
tax statements are mailed by the county treasurer, on the records of the county treasurer.
Every property owner whose name does not appear on the records of the county auditor
or the county treasurer is deemed to have waived this mailed notice unless the owner
has requested in writing that the county auditor or county treasurer, as the case may be,
include the name on the records for this purpose. The notice must project the anticipated
amount of tax increase in annual dollars for typical residential homesteads, agricultural
homesteads, apartments, and commercial-industrial property within the school district.
    The notice for a referendum may state that an existing referendum levy is expiring
and project the anticipated amount of increase over the existing referendum levy in
the first year, if any, in annual dollars for typical residential homesteads, agricultural
homesteads, apartments, and commercial-industrial property within the district.
    The notice must include the following statement: "Passage of this referendum will
result in an increase in your property taxes." However, in cases of renewing existing levies,
the notice may include the following statement: "Passage of this referendum extends an
existing operating referendum at the same amount per pupil as in the previous year."
    (c) A referendum on the question of revoking or reducing the increased revenue
amount authorized pursuant to paragraph (a) may be called by the board. A referendum to
revoke or reduce the revenue amount must state the amount per resident marginal cost
pupil unit by which the authority is to be reduced. Revenue authority approved by the
voters of the district pursuant to paragraph (a) must be available to the school district at
least once before it is subject to a referendum on its revocation or reduction for subsequent
years. Only one revocation or reduction referendum may be held to revoke or reduce
referendum revenue for any specific year and for years thereafter.
    (d) The approval of 50 percent plus one of those voting on the question is required to
pass a referendum authorized by this subdivision.
    (e) At least 15 days before the day of the referendum, the district must submit a
copy of the notice required under paragraph (b) to the commissioner and to the county
auditor of each county in which the district is located. Within 15 days after the results
of the referendum have been certified by the board, or in the case of a recount, the
certification of the results of the recount by the canvassing board, the district must notify
the commissioner of the results of the referendum.
    Subd. 10. School referendum levy; market value. A school referendum levy must
be levied against the referendum market value of all taxable property as defined in section
126C.01, subdivision 3. Any referendum levy amount subject to the requirements of this
subdivision must be certified separately to the county auditor under section 275.07.
    Subd. 11. Referendum date. (a) Except for a referendum held under paragraph (b),
any referendum under this section held on a day other than the first Tuesday after the first
Monday in November must be conducted by mail in accordance with section 204B.46.
Notwithstanding subdivision 9, paragraph (b), to the contrary, in the case of a referendum
conducted by mail under this paragraph, the notice required by subdivision 9, paragraph (b),
must be prepared and delivered by first-class mail at least 20 days before the referendum.
(b) In addition to the referenda allowed in subdivision 9, clause (a), the commissioner
may grant authority to a district to hold a referendum on a different day if the district is in
statutory operating debt and has an approved plan or has received an extension from the
department to file a plan to eliminate the statutory operating debt.
(c) The commissioner must approve, deny, or modify each district's request for a
referendum levy on a different day within 60 days of receiving the request from a district.
    Subd. 13. Referendum conversion allowance. A school district that received
supplemental or transition revenue in fiscal year 2002 may convert its supplemental
revenue conversion allowance and transition revenue conversion allowance to additional
referendum allowance under subdivision 1 for fiscal year 2003 and thereafter. A majority
of the school board must approve the conversion at a public meeting before November 1,
2001. For a district with other referendum authority, the referendum conversion allowance
approved by the board continues until the portion of the district's other referendum
authority with the earliest expiration date after June 30, 2006, expires. For a district
with no other referendum authority, the referendum conversion allowance approved by
the board continues until June 30, 2012.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 50. Minnesota Statutes 2012, section 126C.20, is amended to read:
126C.20 ANNUAL GENERAL EDUCATION AID APPROPRIATION.
There is annually appropriated from the general fund to the department the
amount necessary for general education aid under section 126C.13, the early graduation
achievement scholarship program under section 120B.08, and the early graduation
military service award program under section 120B.09. This amount must be reduced by
the amount of any money specifically appropriated for the same purpose in any year
from any state fund.
EFFECTIVE DATE.This section is effective for revenue in fiscal year 2014 and
later.

    Sec. 51. Minnesota Statutes 2012, section 126C.40, subdivision 1, is amended to read:
    Subdivision 1. To lease building or land. (a) When an independent or a special
school district or a group of independent or special school districts finds it economically
advantageous to rent or lease a building or land for any instructional purposes or for
school storage or furniture repair, and it determines that the operating capital revenue
authorized under section 126C.10, subdivision 13, is insufficient for this purpose, it may
apply to the commissioner for permission to make an additional capital expenditure levy
for this purpose. An application for permission to levy under this subdivision must contain
financial justification for the proposed levy, the terms and conditions of the proposed
lease, and a description of the space to be leased and its proposed use.
    (b) The criteria for approval of applications to levy under this subdivision must
include: the reasonableness of the price, the appropriateness of the space to the proposed
activity, the feasibility of transporting pupils to the leased building or land, conformity
of the lease to the laws and rules of the state of Minnesota, and the appropriateness of
the proposed lease to the space needs and the financial condition of the district. The
commissioner must not authorize a levy under this subdivision in an amount greater than
the cost to the district of renting or leasing a building or land for approved purposes.
The proceeds of this levy must not be used for custodial or other maintenance services.
A district may not levy under this subdivision for the purpose of leasing or renting a
district-owned building or site to itself.
    (c) For agreements finalized after July 1, 1997, a district may not levy under this
subdivision for the purpose of leasing: (1) a newly constructed building used primarily
for regular kindergarten, elementary, or secondary instruction; or (2) a newly constructed
building addition or additions used primarily for regular kindergarten, elementary, or
secondary instruction that contains more than 20 percent of the square footage of the
previously existing building.
    (d) Notwithstanding paragraph (b), a district may levy under this subdivision for the
purpose of leasing or renting a district-owned building or site to itself only if the amount
is needed by the district to make payments required by a lease purchase agreement,
installment purchase agreement, or other deferred payments agreement authorized by law,
and the levy meets the requirements of paragraph (c). A levy authorized for a district by
the commissioner under this paragraph may be in the amount needed by the district to
make payments required by a lease purchase agreement, installment purchase agreement,
or other deferred payments agreement authorized by law, provided that any agreement
include a provision giving the school districts the right to terminate the agreement
annually without penalty.
    (e) The total levy under this subdivision for a district for any year must not exceed
$150 $162 times the resident adjusted pupil units for the fiscal year to which the levy
is attributable.
    (f) For agreements for which a review and comment have been submitted to the
Department of Education after April 1, 1998, the term "instructional purpose" as used in
this subdivision excludes expenditures on stadiums.
    (g) The commissioner of education may authorize a school district to exceed the
limit in paragraph (e) if the school district petitions the commissioner for approval. The
commissioner shall grant approval to a school district to exceed the limit in paragraph (e)
for not more than five years if the district meets the following criteria:
    (1) the school district has been experiencing pupil enrollment growth in the
preceding five years;
    (2) the purpose of the increased levy is in the long-term public interest;
    (3) the purpose of the increased levy promotes colocation of government services; and
    (4) the purpose of the increased levy is in the long-term interest of the district by
avoiding over construction of school facilities.
    (h) A school district that is a member of an intermediate school district may include
in its authority under this section the costs associated with leases of administrative and
classroom space for intermediate school district programs. This authority must not
exceed $43 $46 times the adjusted marginal cost pupil units of the member districts. This
authority is in addition to any other authority authorized under this section.
    (i) In addition to the allowable capital levies in paragraph (a), for taxes payable in
2012 to 2023, a district that is a member of the "Technology and Information Education
Systems" data processing joint board, that finds it economically advantageous to enter into
a lease agreement to finance improvements to a building and land for a group of school
districts or special school districts for staff development purposes, may levy for its portion
of lease costs attributed to the district within the total levy limit in paragraph (e). The total
levy authority under this paragraph shall not exceed $632,000.
(j) Notwithstanding paragraph (a), a district may levy under this subdivision for the
purpose of leasing administrative space if the district can demonstrate to the satisfaction of
the commissioner that the lease cost for the administrative space is no greater than the
lease cost for instructional space that the district would otherwise lease. The commissioner
must deny this levy authority unless the district passes a resolution stating its intent to
lease instructional space under this section if the commissioner does not grant authority
under this paragraph. The resolution must also certify that the lease cost for administrative
space under this paragraph is no greater than the lease cost for the district's proposed
instructional lease.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 52. Minnesota Statutes 2012, section 126C.40, subdivision 6, is amended to read:
    Subd. 6. Lease purchase; installment buys. (a) Upon application to, and approval
by, the commissioner in accordance with the procedures and limits in subdivision 1,
paragraphs (a) and (b), a district, as defined in this subdivision, may:
(1) purchase real or personal property under an installment contract or may lease
real or personal property with an option to purchase under a lease purchase agreement, by
which installment contract or lease purchase agreement title is kept by the seller or vendor
or assigned to a third party as security for the purchase price, including interest, if any; and
(2) annually levy the amounts necessary to pay the district's obligations under the
installment contract or lease purchase agreement.
(b) The obligation created by the installment contract or the lease purchase
agreement must not be included in the calculation of net debt for purposes of section
475.53, and does not constitute debt under other law. An election is not required in
connection with the execution of the installment contract or the lease purchase agreement.
(c) The proceeds of the levy authorized by this subdivision must not be used to
acquire a facility to be primarily used for athletic or school administration purposes.
(d) For the purposes of this subdivision, "district" means:
(1) a school district which is eligible for revenue under section 124D.86, subdivision
3
, clause (1), (2), or (3), and whose Special School District No. 1, Minneapolis,
Independent School District No. 625, St. Paul, Independent School District No. 709,
Duluth, or Independent School District No. 535, Rochester, if the district's desegregation
plan has been determined by the commissioner to be in compliance with Department of
Education rules relating to equality of educational opportunity and school desegregation
and, for a district eligible for revenue under section 124D.86, subdivision 3, clause (4)
or (5), where the acquisition of property under this subdivision is determined by the
commissioner to contribute to the implementation of the desegregation plan; or
(2) a school district that participates in a joint program for interdistrict desegregation
with a district defined in clause (1) other districts eligible for revenue under section
124D.862 if the facility acquired under this subdivision is to be primarily used for the a
joint program for interdistrict desegregation and the commissioner determines that the
joint programs are being undertaken to implement the districts' desegregation plan.
(e) Notwithstanding subdivision 1, the prohibition against a levy by a district to lease
or rent a district-owned building to itself does not apply to levies otherwise authorized
by this subdivision.
(f) For the purposes of this subdivision, any references in subdivision 1 to building
or land shall include personal property.

    Sec. 53. Minnesota Statutes 2012, section 126C.44, is amended to read:
126C.44 SAFE SCHOOLS LEVY.
    (a) Each district may make a levy on all taxable property located within the district
for the purposes specified in this section. The maximum amount which may be levied for
all costs under this section shall be equal to $30 $36 multiplied by the district's adjusted
marginal cost pupil units for the school year. The proceeds of the levy must be reserved
and used for directly funding the following purposes or for reimbursing the cities and
counties who contract with the district for the following purposes:
    (1) to pay the costs incurred for the salaries, benefits, and transportation costs of
peace officers and sheriffs for liaison in services in the district's schools;
    (2) to pay the costs for a drug abuse prevention program as defined in section
609.101, subdivision 3, paragraph (e), in the elementary schools;
    (3) to pay the costs for a gang resistance education training curriculum in the
district's schools;
    (4) to pay the costs for security in the district's schools and on school property;
    (5) to pay the costs for other crime prevention, drug abuse, student and staff safety,
voluntary opt-in suicide prevention tools, and violence prevention measures taken by
the school district; or
    (6) to pay costs for licensed school counselors, licensed school nurses, licensed
school social workers, licensed school psychologists, and licensed alcohol and chemical
dependency counselors to help provide early responses to problems;
    (7) to pay for facility security enhancements including laminated glass, public
announcement systems, emergency communications devices, and equipment and facility
modifications related to violence prevention and facility security;
    (8) to pay for costs associated with improving the school climate; or
    (9) to pay costs for colocating and collaborating with mental health professionals
who are not district employees or contractors.
    (b) For expenditures under paragraph (a), clause (1), the district must initially
attempt to contract for services to be provided by peace officers or sheriffs with the
police department of each city or the sheriff's department of the county within the district
containing the school receiving the services. If a local police department or a county
sheriff's department does not wish to provide the necessary services, the district may
contract for these services with any other police or sheriff's department located entirely or
partially within the school district's boundaries.
    (b) (c) A school district that is a member of an intermediate school district may
include in its authority under this section the costs associated with safe schools activities
authorized under paragraph (a) for intermediate school district programs. This authority
must not exceed $10 times the adjusted marginal cost pupil units of the member districts.
This authority is in addition to any other authority authorized under this section. Revenue
raised under this paragraph must be transferred to the intermediate school district.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 54. Minnesota Statutes 2012, section 127A.47, subdivision 7, is amended to read:
    Subd. 7. Alternative attendance programs. (a) The general education aid and
special education aid for districts must be adjusted for each pupil attending a nonresident
district under sections 123A.05 to 123A.08, 124D.03, 124D.08, and 124D.68. The
adjustments must be made according to this subdivision.
    (a) General education aid paid to a resident district must be reduced by an amount
equal to the referendum equalization aid attributable to the pupil in the resident district.
    (b) General education aid paid to a district serving a pupil in programs listed in this
subdivision must be increased by an amount equal to the greater of (1) the referendum
equalization aid attributable to the pupil in the nonresident district; or (2) the product of
the district's open enrollment concentration index, the maximum amount of referendum
revenue in the first tier, and the district's net open enrollment pupil units for that year. A
district's open enrollment concentration index equals the greater of: (i) zero, or (ii) the
lesser of 1.0, or the difference between the district's ratio of open enrollment pupil units
served to its resident pupil units for that year and 0.2. This clause does not apply to a
school district where more than 50 percent of the open enrollment students are enrolled
solely in online learning courses.
    (c) If the amount of the reduction to be made from the general education aid of the
resident district is greater than the amount of general education aid otherwise due the
district, the excess reduction must be made from other state aids due the district.
    (d) For fiscal year 2006, the district of residence must pay tuition to a district or an
area learning center, operated according to paragraph (f), providing special instruction and
services to a pupil with a disability, as defined in section 125A.02, or a pupil, as defined in
section 125A.51, who is enrolled in a program listed in this subdivision. The tuition must
be equal to (1) the actual cost of providing special instruction and services to the pupil,
including a proportionate amount for special transportation and unreimbursed building
lease and debt service costs for facilities used primarily for special education, minus (2)
if the pupil receives special instruction and services outside the regular classroom for
more than 60 percent of the school day, the amount of general education revenue and
referendum aid attributable to that pupil for the portion of time the pupil receives special
instruction and services outside of the regular classroom, excluding portions attributable to
district and school administration, district support services, operations and maintenance,
capital expenditures, and pupil transportation, minus (3) special education aid attributable
to that pupil, that is received by the district providing special instruction and services.
For purposes of this paragraph, general education revenue and referendum equalization
aid attributable to a pupil must be calculated using the serving district's average general
education revenue and referendum equalization aid per adjusted pupil unit.
    (e) For fiscal year 2007 and later, special education aid paid to a resident district must
be reduced by an amount equal to (b) For purposes of this subdivision, the "unreimbursed
cost of providing special education and services" means the difference between: (1) the
actual cost of providing special instruction and services, including special transportation
and unreimbursed building lease and debt service costs for facilities used primarily for
special education, for a pupil with a disability, as defined in section 125A.02, or a pupil, as
defined in section 125A.51, who is enrolled in a program listed in this subdivision, minus
(2) if the pupil receives special instruction and services outside the regular classroom for
more than 60 percent of the school day, the amount of general education revenue and
referendum equalization aid attributable to that pupil for the portion of time the pupil
receives special instruction and services outside of the regular classroom, excluding
portions attributable to district and school administration, district support services,
operations and maintenance, capital expenditures, and pupil transportation, minus (3)
special education aid under section 125A.76 attributable to that pupil, that is received by
the district providing special instruction and services. For purposes of this paragraph,
general education revenue and referendum equalization aid attributable to a pupil must be
calculated using the serving district's average general education revenue and referendum
equalization aid per adjusted pupil unit.
(c) For fiscal year 2015 and later, special education aid paid to a resident district
must be reduced by an amount equal to 90 percent of the unreimbursed cost of providing
special education and services.
(d) Notwithstanding paragraph (c), special education aid paid to a resident district
must be reduced by an amount equal to 100 percent of the unreimbursed cost of special
education and services provided to students at an intermediate district, cooperative, or
charter school where the percent of students eligible for special education services is at
least 70 percent of the charter school's total enrollment.
    (e) Special education aid paid to the district or cooperative providing special
instruction and services for the pupil, or to the fiscal agent district for a cooperative,
must be increased by the amount of the reduction in the aid paid to the resident district
under paragraphs (c) and (d). If the resident district's special education aid is insufficient
to make the full adjustment, the remaining adjustment shall be made to other state aids
due to the district.
    (f) An area learning center operated by a service cooperative, intermediate district,
education district, or a joint powers cooperative may elect through the action of the
constituent boards to charge the resident district tuition for pupils rather than to have the
general education revenue paid to a fiscal agent school district. Except as provided in
paragraph (d) or (e), the district of residence must pay tuition equal to at least 90 percent
of the district average general education revenue per pupil unit minus an amount equal
to the product of the formula allowance according to section 126C.10, subdivision 2,
times .0485 .0466, calculated without compensatory revenue and transportation sparsity
revenue, times the number of pupil units for pupils attending the area learning center.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 55. Minnesota Statutes 2012, section 127A.47, subdivision 8, is amended to read:
    Subd. 8. Charter schools. (a) The general education aid for districts must be
adjusted for each pupil attending a charter school under section 124D.10. The adjustments
must be made according to this subdivision.
(b) General education aid paid to a district in which a charter school not providing
transportation according to section 124D.10, subdivision 16, is located must be increased
by an amount equal to the sum of:
(1) the product of: (i) the sum of an amount equal to the product of the formula
allowance according to section 126C.10, subdivision 2, times .0485 .0466, plus the
transportation sparsity allowance for the district; times (ii) the adjusted marginal cost
pupil units attributable to the pupil; plus
(2) the product of $223 and the extended time marginal cost pupil units attributable
to the pupil.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 56. Minnesota Statutes 2012, section 127A.51, is amended to read:
127A.51 STATEWIDE AVERAGE REVENUE.
By October 1 of each year the commissioner must estimate the statewide average
adjusted general revenue per adjusted marginal cost pupil unit and the disparity in adjusted
general revenue among pupils and districts by computing the ratio of the 95th percentile
to the fifth percentile of adjusted general revenue. The commissioner must provide that
information to all districts.
If the disparity in adjusted general revenue as measured by the ratio of the 95th
percentile to the fifth percentile increases in any year, the commissioner shall recommend
to the legislature options for change in the general education formula that will limit the
disparity in adjusted general revenue to no more than the disparity for the previous
school year. The commissioner must submit the recommended options to the education
committees of the legislature by January 15.
For purposes of this section and section 126C.10, adjusted general revenue means:
(1) for fiscal year 2002, the sum of basic revenue under section 126C.10, subdivision
2
; supplemental revenue under section 126C.10, subdivisions 9 and 12; transition revenue
under section 126C.10, subdivision 20; referendum revenue under section 126C.17; and
equity revenue under section 126C.10, subdivisions 24a and 24b; and
(2) for fiscal year 2003 and later, the sum of basic revenue under section 126C.10,
subdivision 2
; referendum revenue under section 126C.17; and equity revenue under
section 126C.10, subdivisions 24a and 24b.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 57. SCHOOL DISTRICT LEVY ADJUSTMENTS.
    Subdivision 1. Tax rate adjustment. The commissioner of education must adjust
each school district tax rate established under Minnesota Statutes, chapters 120B to 127A,
by multiplying the rate by the ratio of the statewide total tax capacity for assessment year
2012 as it existed prior to the passage of Regular Session 2013 House File No. 677, or
a similarly styled bill passed in a special session, to the statewide total tax capacity for
assessment year 2012.
    Subd. 2. Equalizing factors. The commissioner of education must adjust each
school district equalizing factor established under Minnesota Statutes, chapters 120B to
127A, by dividing the equalizing factor by the ratio of the statewide total tax capacity for
assessment year 2012 as it existed prior to the passage of Regular Session 2013 House
File No. 677, or a similarly styled bill passed in a special session, to the statewide total tax
capacity for assessment year 2012.

    Sec. 58. APPROPRIATIONS.
    Subdivision 1. Department of Education. The sums indicated in this section are
appropriated from the general fund to the Department of Education for the fiscal years
designated.
    Subd. 2. General education aid. For general education aid under Minnesota
Statutes, section 126C.13, subdivision 4:

$
6,051,766,000
.....
2014

$
6,370,640,000
.....
2015
The 2014 appropriation includes $781,842,000 for 2013 and $5,269,924,000 for
2014.
The 2015 appropriation includes $823,040,000 for 2014 and $5,547,600,000 for
2015.
    Subd. 3. Enrollment options transportation. For transportation of pupils attending
postsecondary institutions under Minnesota Statutes, section 124D.09, or for transportation
of pupils attending nonresident districts under Minnesota Statutes, section 124D.03:

$
44,000
.....
2014

$
48,000
.....
2015
    Subd. 4. Abatement revenue. For abatement aid under Minnesota Statutes, section
127A.49:

$
2,747,000
.....
2014

$
3,136,000
.....
2015
The 2014 appropriation includes $301,000 for 2013 and $2,446,000 for 2014.
The 2015 appropriation includes $385,000 for 2014 and $2,751,000 for 2015.
    Subd. 5. Consolidation transition. For districts consolidating under Minnesota
Statutes, section 123A.485:

$
472,000
.....
2014

$
480,000
.....
2015
The 2014 appropriation includes $40,000 for 2013 and $432,000 for 2014.
The 2015 appropriation includes $68,000 for 2014 and $412,000 for 2015.
    Subd. 6. Nonpublic pupil education aid. For nonpublic pupil education aid under
Minnesota Statutes, sections 123B.40 to 123B.43 and 123B.87:

$
15,582,000
.....
2014

$
16,169,000
.....
2015
The 2014 appropriation includes $2,099,000 for 2013 and $13,483,000 for 2014.
The 2015 appropriation includes $2,122,000 for 2014 and $14,047,000 for 2015.
    Subd. 7. Nonpublic pupil transportation. For nonpublic pupil transportation aid
under Minnesota Statutes, section 123B.92, subdivision 9:

$
18,565,000
.....
2014

$
18,946,000
.....
2015
The 2014 appropriation includes $2,668,000 for 2013 and $15,897,000 for 2014.
The 2015 appropriation includes $2,502,000 for 2014 and $16,444,000 for 2015.
    Subd. 8. One-room schoolhouse. For a grant to Independent School District No.
690, Warroad, to operate the Angle Inlet School:

$
65,000
.....
2014

$
65,000
.....
2015
    Subd. 9. Compensatory revenue pilot project. For grants for participation in the
compensatory revenue pilot program under Laws 2005, First Special Session chapter 5,
article 1, section 50, as amended by Laws 2007, chapter 146, article 1, section 21:

$
7,325,000
2014

$
7,325,000
2015
Of this amount, $4,730,000 in each year is for a grant to Independent School District
No. 11, Anoka-Hennepin; $240,000 in each year is for a grant to Independent School
District No. 286, Brooklyn Center; $660,000 in each year is for a grant to Independent
School District No. 279, Osseo; $500,000 in each year is for a grant to Independent School
District No. 281, Robbinsdale; $520,000 in each year is for a grant to Independent School
District No. 535, Rochester; $205,000 in each year is for a grant to Independent School
District No. 833, South Washington; and $470,000 in each year is for a grant to Independent
School District No. 241, Albert Lea. If a grant to a specific school district is not awarded,
the commissioner may increase the aid amounts to any of the remaining participating
school districts. The base budget for this program for fiscal year 2016 and later is
$2,325,000, and the grants must be distributed in the same proportion as in fiscal year 2013.
    Subd. 10. Compensatory pilot project formula aid. For grants for compensatory
pilot project formula aid as calculated under Minnesota Statutes, section 126C.195:

$
2,109,000
.....
2014
The 2014 appropriation includes $2,109,000 for 2013 and $0 for 2014.
    Subd. 11. Career and technical aid. For career and technical aid under Minnesota
Statutes, section 124D.4531, subdivision 1b:

$
4,320,000
.....
2014

$
5,680,000
.....
2015
The 2014 appropriation includes $0 for 2014 and $4,320,000 for 2015.
The 2015 appropriation includes $680,000 for 2014 and $5,000,000 for 2015.

    Sec. 59. REPEALER.
(a) Minnesota Statutes 2012, sections 120B.08; and 120B.09, are repealed for fiscal
year 2014 and later.
(b) Minnesota Statutes 2012, sections 126C.10, subdivisions 31a, 31b, 31c, 34, 35,
and 36; 126C.17, subdivision 13; and 127A.50, subdivisions 1 and 5, are repealed for
fiscal year 2015 and later.

ARTICLE 2
STUDENT ACCOUNTABILITY

    Section 1. [120B.018] DEFINITIONS.
    Subdivision 1. Scope. The definitions in this section apply to this chapter.
    Subd. 2. Academic standard. "Academic standard" means a summary description
of student learning in a required content area under section 120B.021 or elective content
area under section 120B.022.
    Subd. 3. Benchmark. "Benchmark" means specific knowledge or skill that a
student must master to complete part of an academic standard by the end of the grade
level or grade band.
    Subd. 4. Credit. "Credit" means the determination by the local school district
that a student has successfully completed an academic year of study or mastered the
applicable subject matter.
    Subd. 5. Elective standard. "Elective standard" means a locally adopted
expectation for student learning in career and technical education and world languages.
    Subd. 6. Required standard. "Required standard" means (1) a statewide adopted
expectation for student learning in the content areas of language arts, mathematics,
science, social studies, physical education, and the arts, or (2) a locally adopted
expectation for student learning in health or the arts.

    Sec. 2. Minnesota Statutes 2012, section 120B.02, is amended to read:
120B.02 EDUCATIONAL EXPECTATIONS AND GRADUATION
REQUIREMENTS FOR MINNESOTA'S STUDENTS.
    Subdivision 1. Educational expectations. (a) The legislature is committed to
establishing rigorous academic standards for Minnesota's public school students. To
that end, the commissioner shall adopt in rule statewide academic standards. The
commissioner shall not prescribe in rule or otherwise the delivery system, classroom
assessments, or form of instruction that school sites must use. For purposes of this chapter,
a school site is a separate facility, or a separate program within a facility that a local school
board recognizes as a school site for funding purposes.
(b) All commissioner actions regarding the rule must be premised on the following:
(1) the rule is intended to raise academic expectations for students, teachers, and
schools;
(2) any state action regarding the rule must evidence consideration of school district
autonomy; and
(3) the Department of Education, with the assistance of school districts, must make
available information about all state initiatives related to the rule to students and parents,
teachers, and the general public in a timely format that is appropriate, comprehensive, and
readily understandable.
(c) When fully implemented, the requirements for high school graduation in
Minnesota must require students to satisfactorily complete, as determined by the school
district, the course credit requirements under section 120B.024, all state academic
standards or local academic standards where state standards do not apply, and successfully
pass graduation examinations as required under section 120B.30.
(d) (c) The commissioner shall periodically review and report on the state's
assessment process.
(e) (d) School districts are not required to adopt specific provisions of the federal
School-to-Work programs.
    Subd. 2. Graduation requirements. To graduate from high school, students must
demonstrate to their enrolling school district or school their satisfactory completion of the
credit requirements under section 120B.024 and their understanding of academic standards
on a nationally normed college entrance exam. A school district must adopt graduation
requirements that meet or exceed state graduation requirements established in law or rule.
EFFECTIVE DATE.This section is effective August 1, 2013, and applies to
students entering grade 9 in the 2013-2014 school year and later.

    Sec. 3. Minnesota Statutes 2012, section 120B.021, subdivision 1, is amended to read:
    Subdivision 1. Required academic standards. (a) The following subject areas
are required for statewide accountability:
    (1) language arts;
    (2) mathematics;
    (3) science;
    (4) social studies, including history, geography, economics, and government and
citizenship;
    (5) physical education;
    (6) health, for which locally developed academic standards apply; and
    (7) the arts, for which statewide or locally developed academic standards apply, as
determined by the school district. Public elementary and middle schools must offer at least
three and require at least two of the following four arts areas: dance; music; theater; and
visual arts. Public high schools must offer at least three and require at least one of the
following five arts areas: media arts; dance; music; theater; and visual arts.
    The commissioner must submit proposed standards in science and social studies to
the legislature by February 1, 2004.
    (b) For purposes of applicable federal law, the academic standards for language arts,
mathematics, and science apply to all public school students, except the very few students
with extreme cognitive or physical impairments for whom an individualized education
program team has determined that the required academic standards are inappropriate. An
individualized education program team that makes this determination must establish
alternative standards.
    A school district, no later than the 2007-2008 school year, must adopt graduation
requirements that meet or exceed state graduation requirements established in law or rule.
A school district that incorporates these state graduation requirements before the 2007-2008
school year must provide students who enter the 9th grade in or before the 2003-2004
school year the opportunity to earn a diploma based on existing locally established
graduation requirements in effect when the students entered the 9th grade. (c) District
efforts to develop, implement, or improve instruction or curriculum as a result of the
provisions of this section must be consistent with sections 120B.10, 120B.11, and 120B.20.
    The commissioner must include the contributions of Minnesota American Indian
tribes and communities as they relate to the academic standards during the review and
revision of the required academic standards.

    Sec. 4. Minnesota Statutes 2012, section 120B.023, is amended to read:
120B.023 BENCHMARKS.
    Subdivision 1. Benchmarks implement, supplement statewide academic
standards. (a) The commissioner must supplement required state academic standards with
grade-level benchmarks. High school career and college ready benchmarks may cover
more than one grade. The benchmarks must implement statewide academic standards
by specifying the academic knowledge and skills that Schools must offer and students
must achieve all benchmarks for an academic standard to satisfactorily complete a that
state standard. The commissioner must publish benchmarks to inform and guide parents,
teachers, school districts, and other interested persons and to use in developing tests
consistent with the benchmarks.
(b) The commissioner shall publish benchmarks in the State Register and transmit
the benchmarks in any other manner that informs and guides parents, teachers, school
districts, and other interested persons and makes them accessible to the general public. The
commissioner must use benchmarks in developing career and college readiness assessments
under section 120B.30. The commissioner may charge a reasonable fee for publications.
(c) Once established, the commissioner may change the benchmarks only with
specific legislative authorization and after completing a review under subdivision 2.
(d) The commissioner must develop and implement a system for reviewing each
of the required academic standards and related benchmarks and elective standards on a
periodic cycle, consistent with subdivision 2.
(e) (d) The benchmarks are not subject to chapter 14 and section 14.386 does not
apply.
    Subd. 2. Revisions and reviews required. (a) The commissioner of education must
revise and appropriately embed technology and information literacy standards consistent
with recommendations from school media specialists into the state's academic standards
and graduation requirements and implement a review ten-year cycle for to review and
revise state academic standards and related benchmarks, consistent with this subdivision.
During each ten-year review and revision cycle, the commissioner also must examine the
alignment of each required academic standard and related benchmark with the knowledge
and skills students need for career and college readiness and advanced work in the
particular subject area. The commissioner must include the contributions of Minnesota
American Indian tribes and communities as related to the academic standards during the
review and revision of the required academic standards.
(b) The commissioner in the 2006-2007 school year must revise and align the state's
academic standards and high school graduation requirements in mathematics to require
that students satisfactorily complete the revised mathematics standards, beginning in the
2010-2011 school year. Under the revised standards:
(1) students must satisfactorily complete an algebra I credit by the end of eighth
grade; and
(2) students scheduled to graduate in the 2014-2015 school year or later must
satisfactorily complete an algebra II credit or its equivalent.
    (b) The commissioner also must ensure that the statewide mathematics assessments
administered to students in grades 3 through 8 and 11 are aligned with the state academic
standards in mathematics, consistent with section 120B.30, subdivision 1, paragraph
(b). The commissioner must implement a review of the academic standards and related
benchmarks in mathematics beginning in the 2015-2016 school year.
(c) The commissioner in the 2007-2008 school year must revise and align the state's
academic standards and high school graduation requirements in the arts to require that
students satisfactorily complete the revised arts standards beginning in the 2010-2011
school year. The commissioner must implement a review of the academic standards and
related benchmarks in arts beginning in the 2016-2017 school year.
(d) The commissioner in the 2008-2009 school year must revise and align the state's
academic standards and high school graduation requirements in science to require that
students satisfactorily complete the revised science standards, beginning in the 2011-2012
school year. Under the revised standards, students scheduled to graduate in the 2014-2015
school year or later must satisfactorily complete a chemistry or physics credit or a career
and technical education credit that meets standards underlying the chemistry, physics,
or biology credit or a combination of those standards approved by the district. The
commissioner must implement a review of the academic standards and related benchmarks
in science beginning in the 2017-2018 school year.
(e) The commissioner in the 2009-2010 school year must revise and align the state's
academic standards and high school graduation requirements in language arts to require
that students satisfactorily complete the revised language arts standards beginning in the
2012-2013 school year. The commissioner must implement a review of the academic
standards and related benchmarks in language arts beginning in the 2018-2019 school year.
(f) The commissioner in the 2010-2011 school year must revise and align the state's
academic standards and high school graduation requirements in social studies to require
that students satisfactorily complete the revised social studies standards beginning in the
2013-2014 school year. The commissioner must implement a review of the academic
standards and related benchmarks in social studies beginning in the 2019-2020 school year.
(g) School districts and charter schools must revise and align local academic
standards and high school graduation requirements in health, world languages, and career
and technical education to require students to complete the revised standards beginning
in a school year determined by the school district or charter school. School districts and
charter schools must formally establish a periodic review cycle for the academic standards
and related benchmarks in health, world languages, and career and technical education.

    Sec. 5. Minnesota Statutes 2012, section 120B.024, is amended to read:
120B.024 GRADUATION REQUIREMENTS; COURSE CREDITS.
    Subdivision 1. Graduation requirements. (a) Students beginning 9th grade in the
2011-2012 school year and later must successfully complete the following high school
level course credits for graduation:
    (1) four credits of language arts sufficient to satisfy all of the academic standards
in English language arts;
    (2) three credits of mathematics, encompassing at least algebra, geometry, statistics,
and probability including an algebra II credit or its equivalent, sufficient to satisfy all of
the academic standard standards in mathematics;
(3) an algebra I credit by the end of 8th grade sufficient to satisfy all of the 8th
grade standards in mathematics;
    (3) (4) three credits of science, including at least: (i) one credit in of biology; and
(ii) one chemistry or physics credit or a career and technical education credit that meets
standards underlying the chemistry, physics, or biology credit or a combination of those
standards approved by the district, but meeting biology standards under this item does not
meet the biology requirement under item (i), one credit of chemistry or physics, and one
elective credit of science. The combination of credits under this clause must be sufficient
to satisfy (i) all of the academic standards in either chemistry or physics and (ii) all other
academic standards in science;
    (4) (5) three and one-half credits of social studies, encompassing at least United
States history, geography, government and citizenship, world history, and economics or
three credits of social studies encompassing at least United States history, geography,
government and citizenship, and world history, and one-half credit of economics taught in
a school's social studies, agriculture education, or business department sufficient to satisfy
all of the academic standards in social studies;
    (5) (6) one credit in of the arts sufficient to satisfy all of the state or local academic
standards in the arts; and
    (6) (7) a minimum of seven elective course credits.
    A course credit is equivalent to a student successfully completing an academic
year of study or a student mastering the applicable subject matter, as determined by the
local school district.
    Subd. 2. Credit equivalencies. (a) A one-half credit of economics taught in a
school's agriculture education or business department may fulfill a one-half credit in
social studies under subdivision 1, clause (5), if the credit is sufficient to satisfy all of the
academic standards in economics.
    (b) An agriculture science course or career and technical education credit may
fulfill a the elective science credit requirement other than the specified science credit in
biology under paragraph (a), clause (3). subdivision 1, clause (4), if the course meets
academic standards in science as approved by the district. An agriculture science or
career and technical education credit may fulfill the credit in chemistry or physics or the
elective science credit required under subdivision 1, clause (4), if (1) the credit meets the
chemistry, physics, or biology academic standards or a combination of these academic
standards as approved by the district and (2) the student satisfies either all of the chemistry
academic standards, all of the physics academic standards, or all of the applicable elective
science standards prior to graduation. An agriculture science or career and technical
education credit may not fulfill the required biology credit under subdivision 1, clause (4).
    (c) A career and technical education course credit may fulfill a mathematics or arts
credit requirement or a science credit requirement other than the specified science credit in
biology under paragraph (a) subdivision 1, clause (2), (3), or (5) (6).
(d) An agriculture education teacher is not required to meet the requirements of
Minnesota Rules, part 3505.1150, subpart 1, item B, to meet the credit equivalency
requirements of paragraph (b) above.
EFFECTIVE DATE.This section is effective August 1, 2013, and applies to
students entering 9th grade in the 2013-2014 school year and later.

    Sec. 6. Minnesota Statutes 2012, section 120B.11, is amended to read:
120B.11 SCHOOL DISTRICT PROCESS FOR REVIEWING CURRICULUM,
INSTRUCTION, AND STUDENT ACHIEVEMENT; STRIVING FOR THE
WORLD'S BEST WORKFORCE.
    Subdivision 1. Definitions. For the purposes of this section and section 120B.10,
the following terms have the meanings given them.
    (a) "Instruction" means methods of providing learning experiences that enable a
student to meet state and district academic standards and graduation requirements.
    (b) "Curriculum" means district or school adopted programs and written plans for
providing students with learning experiences that lead to expected knowledge and skills
and career and college readiness.
    (c) "World's best workforce" means striving to: meet school readiness goals; have
all third grade students achieve grade-level literacy; close the academic achievement gap
among all racial and ethnic groups of students and between students living in poverty and
students not living in poverty; have all students attain career and college readiness before
graduating from high school; and have all students graduate from high school.
    Subd. 1a. Performance measures. Measures to determine school district and
school site progress in striving to create the world's best workforce must include at least:
(1) student performance on the National Association of Education Progress;
(2) the size of the academic achievement gap by student subgroup;
(3) student performance on the Minnesota Comprehensive Assessments;
(4) high school graduation rates; and
(5) career and college readiness under section 120B.30, subdivision 1.
    Subd. 2. Adopting policies plans and budgets. A school board, at a public
meeting, shall have in place an adopted written policy adopt a comprehensive, long-term
strategic plan to support and improve teaching and learning that includes the following is
aligned with creating the world's best workforce and includes:
    (1) clearly defined district and school site goals and benchmarks for instruction
including the use of best practices, district and school curriculum, and student achievement
for all student subgroups identified in section 120B.35, subdivision 3, paragraph (b),
clause (2);
    (2) a process for assessing and evaluating each student's progress toward meeting state
and local academic standards and identifying the strengths and weaknesses of instruction
in pursuit of student and school success and curriculum affecting students' progress and
growth toward career and college readiness and leading to the world's best workforce;
    (3) a system for periodically reviewing and evaluating to periodically review and
evaluate the effectiveness of all instruction and curriculum, taking into account strategies
and best practices, student outcomes, school principal evaluations under section 123B.147,
subdivision 3, and teacher evaluations under section 122A.40, subdivision 8, or 122A.41,
subdivision 5;
    (4) a plan strategies for improving instruction, curriculum, and student achievement;
and
    (5) an education effectiveness plan aligned with section 122A.625 practices that
integrates integrate high-quality instruction, rigorous curriculum, and technology, and a
collaborative professional culture that develops and supports teacher quality, performance,
and effectiveness; and
    (6) an annual budget for continuing to implement the district plan.
    Subd. 3. District advisory committee. Each school board shall establish an
advisory committee to ensure active community participation in all phases of planning and
improving the instruction and curriculum affecting state and district academic standards,
consistent with subdivision 2. A district advisory committee, to the extent possible, shall
reflect the diversity of the district and its learning school sites, and shall include teachers,
parents, support staff, students, and other community residents. The district may establish
building site teams as subcommittees of the district advisory committee under subdivision
4. The district advisory committee shall recommend to the school board rigorous academic
standards, student achievement goals and measures consistent with subdivision 1a and
sections 120B.022, subdivision 1, paragraphs (b) and (c), and 120B.35, district assessments,
and program evaluations. Learning School sites may expand upon district evaluations of
instruction, curriculum, assessments, or programs. Whenever possible, parents and other
community residents shall comprise at least two-thirds of advisory committee members.
    Subd. 4. Building Site team. A school may establish a building site team to
develop and implement an strategies and education effectiveness plan practices to improve
instruction, curriculum, and student achievement at the school site, consistent with
subdivision 2. The team shall advise advises the board and the advisory committee about
developing the annual budget and revising an instruction and curriculum improvement
plan that aligns curriculum, assessment of student progress and growth in meeting state
and district academic standards, and instruction.
    Subd. 5. Report. (a) By October 1 of each year, the school board shall use standard
statewide reporting procedures the commissioner develops and adopt a report that includes
the following:
    (1) student achievement goals for meeting state academic standards;
    (2) results of local assessment data, and any additional test data;
    (3) the annual school district improvement plans including staff development goals
under section 122A.60;
    (4) information about district and learning site progress in realizing previously
adopted improvement plans; and
    (5) the amount and type of revenue attributed to each education site as defined
in section 123B.04.
    (b) Consistent with requirements for school performance reports under section
120B.36, subdivision 1, the school board shall publish a summary of the report in the local
newspaper with the largest circulation in the district, by mail, or by electronic means
such as on the district Web site. The school board shall hold an annual public meeting
to review, and revise where appropriate, student achievement goals, local assessment
outcomes, plans, strategies, and practices for improving curriculum and instruction, and to
review district success in realizing the previously adopted student achievement goals and
related benchmarks and the improvement plans leading to the world's best workforce. If
electronic means are used, school districts must publish notice of the report in a periodical
of general circulation in the district. School districts must make copies of the report
available to the public on request.
    (c) The title of the report shall contain the name and number of the school district and
read "Annual Report on Curriculum, Instruction, and Student Achievement." The report
must include at least the following information about advisory committee membership:
    (1) the name of each committee member and the date when that member's term
expires;
    (2) the method and criteria the school board uses to select committee members; and
    (3) the date by which a community resident must apply to next serve on the
committee. The school board must transmit an electronic summary of its report to the
commissioner in the form and manner the commissioner determines.
    Subd. 6. Student evaluation. The school board annually shall provide high school
graduates or GED recipients who receive a diploma or its equivalent from the school
district with an opportunity to report to the board on the following:
    (1) the quality of district instruction, curriculum, and services;
    (2) the quality of district delivery of instruction, curriculum, and services;
    (3) the utility of district facilities; and
    (4) the effectiveness of district administration.
    Subd. 7. Periodic report. Each school district shall periodically ask survey affected
constituencies about their connection to and level of satisfaction with school. The
district shall include the results of this evaluation in the summary report required under
subdivision 5.
    Subd. 8. Biennial evaluation; assessment program. At least once every two years,
the district report shall include an evaluation of the district testing programs, according to
the following:
    (1) written objectives of the assessment program;
    (2) names of tests and grade levels tested;
    (3) use of test results; and
    (4) student achievement results compared to previous years.
    Subd. 9. Annual evaluation. (a) The commissioner must identify effective
strategies, practices, and use of resources by districts and school sites in striving for the
world's best workforce. The commissioner must assist districts and sites throughout the
state in implementing these effective strategies, practices, and use of resources.
(b) The commissioner must identify those districts in any consecutive three-year
period not making sufficient progress toward improving teaching and learning and
striving for the world's best workforce. The commissioner, in collaboration with the
identified district, may require the district to use up to two percent of its basic general
education revenue per fiscal year during the proximate three school years to implement
commissioner-specified strategies and practices, consistent with paragraph (a), to improve
and accelerate its progress in realizing its goals under this section. In implementing this
section, the commissioner must consider districts' budget constraints and legal obligations.
EFFECTIVE DATE.This section is effective for the 2013-2014 school year and
later.

    Sec. 7. [120B.115] REGIONAL CENTERS OF EXCELLENCE.
(a) Regional centers of excellence are established to assist and support school
boards, school districts, school sites, and charter schools in implementing research-based
interventions and practices to increase the students' achievement within a region.
The centers must develop partnerships with local and regional service cooperatives,
postsecondary institutions, integrated school districts, the department, children's mental
health providers, or other local or regional entities interested in providing a cohesive
and consistent regional delivery system that serves all schools equitably. Centers must
assist school districts, school sites, and charter schools in developing similar partnerships.
Center support may include assisting school districts, school sites, and charter schools
with common principles of effective practice, including:
(1) defining measurable education goals under section 120B.11, subdivision 2;
(2) implementing evidence-based practices;
(3) engaging in data-driven decision-making;
(4) providing multi-layered levels of support;
(5) supporting culturally responsive teaching and learning aligning state and local
academic standards and career and college readiness benchmarks; and
(6) engaging parents, families, youth, and local community members in programs
and activities at the school district, school site, or charter school.
Centers must work with school site leadership teams to build capacity to implement
programs that close the achievement gap, increase students' progress and growth toward
career and college readiness, and increase student graduation rates.
(b) The department must assist the regional centers of excellence to meet staff,
facilities, and technical needs, provide the centers with programmatic support, and work
with the centers to establish a coherent statewide system of regional support, including
consulting, training, and technical support, to help school boards, school districts, school
sites, and charter schools effectively and efficiently implement the world's best workforce
goals under section 120B.11 and other state and federal education initiatives.

    Sec. 8. Minnesota Statutes 2012, section 120B.125, is amended to read:
120B.125 PLANNING FOR STUDENTS' SUCCESSFUL TRANSITION
TO POSTSECONDARY EDUCATION AND EMPLOYMENT; INVOLUNTARY
CAREER TRACKING PROHIBITED.
(a) Consistent with sections 120B.128, 120B.13, 120B.131, 120B.132, 120B.14,
120B.15, 120B.30, subdivision 1, paragraph (c), 125A.08, and other related sections,
school districts are strongly encouraged to, beginning in the 2013-2014 school year, must
assist all students by no later than grade 9 to explore their college and career interests and
aspirations and develop a plan for a smooth and successful transition to postsecondary
education or employment. All students' plans must be designed to:
(1) provide a comprehensive academic plan for completing a college and
career-ready curriculum premised on meeting state and local academic standards and
developing 21st century skills such as team work, collaboration, and good work habits;
(2) emphasize academic rigor and high expectations;
(3) help students identify personal learning styles that may affect their postsecondary
education and employment choices;
(4) help students succeed at gaining gain access to postsecondary education and
career options;
(5) integrate strong academic content into career-focused courses and integrate
relevant career-focused courses into strong academic content;
(6) help students and families identify and gain access to appropriate counseling
and other supports and assistance that enable students to complete required coursework,
prepare for postsecondary education and careers, and obtain information about
postsecondary education costs and eligibility for financial aid and scholarship;
(7) help students and families identify collaborative partnerships of kindergarten
through grade 12 schools, postsecondary institutions, economic development agencies, and
employers that support students' transition to postsecondary education and employment
and provide students with experiential learning opportunities; and
(8) be reviewed and revised at least annually by the student, the student's parent or
guardian, and the school or district to ensure that the student's course-taking schedule
keeps the student "on track" making adequate progress to meet state and local high school
graduation requirements and with a reasonable chance to succeed with employment or
postsecondary education without the need to first complete remedial course work.
(b) A school district may develop grade-level curricula or provide instruction that
introduces students to various careers, but must not require any curriculum, instruction,
or employment-related activity that obligates an elementary or secondary student to
involuntarily select a career, career interest, employment goals, or related job training.
(c) School districts are encouraged to seek and use revenue and in-kind contributions
from nonstate sources and to seek administrative cost savings through innovative local
funding arrangements, such as the Collaboration Among Rochester Educators (CARE)
model for funding postsecondary enrollment options, among other sources, for purposes
of implementing this section.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 9. Minnesota Statutes 2012, section 120B.128, is amended to read:
120B.128 EDUCATIONAL PLANNING AND ASSESSMENT SYSTEM
(EPAS) PROGRAM.
(a) School districts and charter schools may elect to participate in the Educational
Planning and Assessment System (EPAS) program offered by ACT, Inc. to provide a
longitudinal, systematic approach to student educational and career planning, assessment,
instructional support, and evaluation. The EPAS achievement tests include English,
reading, mathematics, science, and components on planning for high school and
postsecondary education, interest inventory, needs assessments, and student education
plans. These tests are linked to the ACT assessment for college admission and allow
students, parents, teachers, and schools to determine the student's college readiness before
grades 11 and 12.
(b) The commissioner of education shall provide ACT Explore tests for students
in grade 8 and the ACT Plan test for students in grade 10 to assess individual student
academic strengths and weaknesses, academic achievement and progress, higher order
thinking skills, and college readiness.
(c) Students enrolled in grade 8 through the 2011-2012 school year who have
not yet demonstrated proficiency on the Minnesota comprehensive assessments, the
graduation-required assessments for diploma, or the basic skills testing requirements
prior to high school graduation may satisfy state high school graduation requirements
for assessments in reading, mathematics, and writing by taking the graduation-required
assessment for diploma in reading, mathematics, or writing under Minnesota Statutes
2012, section 120B.30, subdivision 1, paragraph (c), clauses (1) and (2), the WorkKeys
job skills assessment, the Compass college placement test, a nationally recognized armed
services vocation aptitude test, or the ACT assessment for college admission.
(d) The state shall pay the test costs for school districts and charter schools that
choose to participate in the EPAS program public school students to participate in the
assessments under this section. The commissioner shall establish an application procedure
and a process for state payment of costs.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 10. Minnesota Statutes 2012, section 120B.15, is amended to read:
120B.15 GIFTED AND TALENTED STUDENTS PROGRAMS.
    (a) School districts may identify students, locally develop programs addressing
instructional and affective needs, provide staff development, and evaluate programs to
provide gifted and talented students with challenging and appropriate educational programs.
    (b) School districts may must adopt guidelines for assessing and identifying students
for participation in gifted and talented programs. The guidelines should include the use of:
    (1) multiple and objective criteria; and
    (2) assessments and procedures that are valid and reliable, fair, and based on current
theory and research. Assessments and procedures should be sensitive to underrepresented
groups, including, but not limited to, low-income, minority, twice-exceptional, and
English learners.
    (c) School districts must adopt procedures for the academic acceleration of gifted
and talented students. These procedures must include how the district will:
    (1) assess a student's readiness and motivation for acceleration; and
    (2) match the level, complexity, and pace of the curriculum to a student to achieve
the best type of academic acceleration for that student.
(d) School districts must adopt procedures consistent with section 124D.02,
subdivision 1, for early admission to kindergarten or first grade of gifted and talented
learners. The procedures must be sensitive to underrepresented groups.

    Sec. 11. [120B.21] MENTAL HEALTH EDUCATION.
School districts and charter schools are encouraged to provide mental health
instruction for students in grades 6 through 12 aligned with local health standards and
integrated into existing programs, curriculum, or the general school environment of a
district or charter school. The commissioner, in consultation with the commissioner of
human services and mental health organizations, is encouraged to provide districts and
charter schools with:
(1) age-appropriate model learning activities for grades 6 through 12 that encompass
the mental health components of the National Health Education Standards and the
benchmarks developed by the department's quality teaching network in health and best
practices in mental health education; and
(2) a directory of resources for planning and implementing age-appropriate mental
health curriculum and instruction in grades 6 through 12.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 12. Minnesota Statutes 2012, section 120B.30, subdivision 1, is amended to read:
    Subdivision 1. Statewide testing. (a) The commissioner, with advice from experts
with appropriate technical qualifications and experience and stakeholders, consistent
with subdivision 1a, shall include in the comprehensive assessment system, for each
grade level to be tested, state-constructed tests developed from and as computer-adaptive
reading and mathematics assessments for students that are aligned with the state's required
academic standards under section 120B.021, include multiple choice questions, and be are
administered annually to all students in grades 3 through 8 7. Reading and mathematics
assessments for all students in grade 8 must be aligned with the state's required reading and
mathematics standards, be administered annually, and include multiple choice questions.
State-developed high school tests aligned with the state's required academic standards
under section 120B.021 and administered to all high school students in a subject other than
writing must include multiple choice questions. The commissioner shall establish one
or more months during which schools shall administer the tests to students each school
year. For students enrolled in grade 8 before the 2005-2006 school year, Minnesota basic
skills tests in reading, mathematics, and writing shall fulfill students' basic skills testing
requirements for a passing state notation. The passing scores of basic skills tests in reading
and mathematics are the equivalent of 75 percent correct for students entering grade 9
based on the first uniform test administered in February 1998. Students who have not
successfully passed a Minnesota basic skills test by the end of the 2011-2012 school year
must pass the graduation-required assessments for diploma under paragraph (c), except that
for the 2012-2013 and 2013-2014 school years only, these students may satisfy the state's
graduation test requirement for math by complying with paragraph (d), clauses (1) and (3).
(1) Students enrolled in grade 8 through the 2009-2010 school year are eligible
to be assessed under (i) the graduation-required assessment for diploma in reading,
mathematics, or writing under Minnesota Statutes 2012, section 120B.30, subdivision 1,
paragraphs (c), clauses (1) and (2), and (d), (ii) the WorkKeys job skills assessment, (iii)
the Compass college placement test, (iv) the ACT assessment for college admission, or (v)
a nationally recognized armed services vocational aptitude test.
(2) Students enrolled in grade 8 in the 2010-2011 or 2011-2012 school year are
eligible to be assessed under (i) the graduation-required assessment for diploma in reading,
mathematics, or writing under Minnesota Statutes 2012, section 120B.30, subdivision
1, paragraph (c), clauses (1) and (2), (ii) the WorkKeys job skills assessment, (iii) the
Compass college placement test, (iv) the ACT assessment for college admission, or (v) a
nationally recognized armed services vocational aptitude test.
(3) For students under clause (1) or (2), a school district may substitute a score from
an alternative, equivalent assessment to satisfy the requirements of this paragraph.
(b) The state assessment system must be aligned to the most recent revision of
academic standards as described in section 120B.023 in the following manner:
(1) mathematics;
(i) grades 3 through 8 beginning in the 2010-2011 school year; and
(ii) high school level beginning in the 2013-2014 school year;
(2) science; grades 5 and 8 and at the high school level beginning in the 2011-2012
school year; and
(3) language arts and reading; grades 3 through 8 and high school level beginning in
the 2012-2013 school year.
    (c) For students enrolled in grade 8 in the 2005-2006 2012-2013 school year and
later, only the following options shall fulfill students' state graduation test requirements,
based on a longitudinal, systematic approach to student education and career planning,
assessment, instructional support, and evaluation, include the following:
    (1) for reading and mathematics:
    (i) obtaining an achievement level equivalent to or greater than proficient as
determined through a standard setting process on the Minnesota comprehensive
assessments in grade 10 for reading and grade 11 for mathematics or achieving a passing
score as determined through a standard setting process on the graduation-required
assessment for diploma in grade 10 for reading and grade 11 for mathematics or
subsequent retests;
    (ii) achieving a passing score as determined through a standard setting process
on the state-identified language proficiency test in reading and the mathematics test for
English learners or the graduation-required assessment for diploma equivalent of those
assessments for students designated as English learners;
    (iii) achieving an individual passing score on the graduation-required assessment for
diploma as determined by appropriate state guidelines for students with an individualized
education program or 504 plan;
    (iv) obtaining achievement level equivalent to or greater than proficient as
determined through a standard setting process on the state-identified alternate assessment
or assessments in grade 10 for reading and grade 11 for mathematics for students with
an individualized education program; or
    (v) achieving an individual passing score on the state-identified alternate assessment
or assessments as determined by appropriate state guidelines for students with an
individualized education program; and
    (2) for writing:
    (i) achieving a passing score on the graduation-required assessment for diploma;
    (ii) achieving a passing score as determined through a standard setting process on
the state-identified language proficiency test in writing for students designated as English
learners;
    (iii) achieving an individual passing score on the graduation-required assessment for
diploma as determined by appropriate state guidelines for students with an individualized
education program or 504 plan; or
    (iv) achieving an individual passing score on the state-identified alternate assessment
or assessments as determined by appropriate state guidelines for students with an
individualized education program.
    (1) demonstrate understanding of required academic standards on a nationally
normed college entrance exam;
    (2) achievement and career and college readiness tests in mathematics, reading, and
writing, consistent with paragraph (e) and to the extent available, to monitor students'
continuous development of and growth in requisite knowledge and skills; analyze
students' progress and performance levels, identifying students' academic strengths and
diagnosing areas where students require curriculum or instructional adjustments, targeted
interventions, or remediation; and, based on analysis of students' progress and performance
data, determine students' learning and instructional needs and the instructional tools and
best practices that support academic rigor for the student; and
    (3) consistent with this paragraph and section 120B.125, age-appropriate exploration
and planning activities and career assessments to encourage students to identify personally
relevant career interests and aptitudes and help students and their families develop a
regularly reexamined transition plan for postsecondary education or employment without
need for postsecondary remediation.
Based on appropriate state guidelines, students with an individualized education program
may satisfy state graduation requirements by achieving an individual score on the
state-identified alternative assessments.
Expectations of schools, districts, and the state for career or college readiness under
this subdivision must be comparable in rigor, clarity of purpose, and rates of student
completion. A student under clause (2) must receive targeted, relevant, academically
rigorous, and resourced instruction, which may include a targeted instruction and
intervention plan focused on improving the student's knowledge and skills in core subjects
so that the student has a reasonable chance to succeed in a career or college without need
for postsecondary remediation. Consistent with sections 120B.13, 124D.09, 124D.091,
124D.49, and related sections, an enrolling school or district must actively encourage a
student in grade 11 or 12 who is identified as academically ready for a career or college
to participate in courses and programs awarding college credit to high school students.
Students are not required to achieve a specified score or level of proficiency on an
assessment under this subdivision to graduate from high school.
    (d) Students enrolled in grade 8 in any school year from the 2005-2006 school
year to the 2009-2010 school year who do not pass the mathematics graduation-required
assessment for diploma under paragraph (c) are eligible to receive a high school diploma
if they:
(1) complete with a passing score or grade all state and local coursework and credits
required for graduation by the school board granting the students their diploma;
(2) participate in district-prescribed academic remediation in mathematics; and
    (3) fully participate in at least two retests of the mathematics GRAD test or until
they pass the mathematics GRAD test, whichever comes first. To improve the secondary
and postsecondary outcomes of all students, the alignment between secondary and
postsecondary education programs and Minnesota's workforce needs, and the efficiency
and cost-effectiveness of secondary and postsecondary programs, the commissioner, after
consulting with the chancellor of the Minnesota State Colleges and Universities and using
a request for proposal process, shall contract for a series of assessments that are consistent
with this subdivision, aligned with state academic standards, and include career and college
readiness benchmarks. Mathematics, reading, and writing assessments for students in
grades 8 and 10 must be predictive of a nationally normed assessment for career and college
readiness. This nationally recognized assessment must be a college entrance exam and
given to students in grade 11. This series of assessments must include a college placement
diagnostic exam and contain career exploration elements. The commissioner and the
chancellor of the Minnesota State Colleges and Universities must collaborate in aligning
instruction and assessments for adult basic education students to provide the students with
diagnostic information about any targeted interventions they need so that they may seek
postsecondary education or employment without need for postsecondary remediation.
    (1) Districts and schools, on an annual basis, must use the career exploration
elements in these assessments to help students, beginning no later than grade 9, and their
families explore and plan for postsecondary education or careers based on the students'
interests, aptitudes, and aspirations. Districts and schools must use timely regional labor
market information and partnerships, among other resources, to help students and their
families successfully develop, pursue, review, and revise an individualized plan for
postsecondary education or a career. This process must help increase students' engagement
in and connection to school, improve students' knowledge and skills, and deepen students'
understanding of career pathways as a sequence of academic and career courses that lead
to an industry-recognized credential, an associate's degree, or a bachelor's degree and are
available to all students, whatever their interests and career goals.
(2) Students in grade 10 or 11 not yet academically ready for a career or college based
on their growth in academic achievement between grades 8 and 10 must take the college
placement diagnostic exam before taking the college entrance exam under clause (3).
Students, their families, the school, and the district can then use the results of the college
placement diagnostic exam for targeted instruction, intervention, or remediation and
improve students' knowledge and skills in core subjects sufficient for a student to graduate
and have a reasonable chance to succeed in a career or college without remediation.
(3) All students except those eligible for alternative assessments must be given the
college entrance part of these assessments in grade 11. A student under this clause who
demonstrates attainment of required state academic standards, which include career and
college readiness benchmarks, on these assessments is academically ready for a career or
college and is encouraged to participate in courses awarding college credit to high school
students. Such courses and programs may include sequential courses of study within
broad career areas and technical skill assessments that extend beyond course grades.
(4) As appropriate, students through grade 12 must continue to participate in targeted
instruction, intervention, or remediation and be encouraged to participate in courses
awarding college credit to high school students.
    (5) A study to determine the alignment between these assessments and state
academic standards under this chapter must be conducted. Where alignment exists, the
commissioner must seek federal approval to, and immediately upon receiving approval,
replace the federally required assessments referenced under subdivision 1a and section
120B.35, subdivision 2, with assessments under this paragraph.
    (e) In developing, supporting, and improving students' academic readiness for a
career or college, schools, districts, and the state must have a continuum of empirically
derived, clearly defined benchmarks focused on students' attainment of knowledge and
skills so that students, their parents, and teachers know how well students must perform to
have a reasonable chance to succeed in a career or college without need for postsecondary
remediation. The commissioner, in consultation with local school officials and educators,
and Minnesota's public postsecondary institutions must ensure that the foundational
knowledge and skills for students' successful performance in postsecondary employment
or education and an articulated series of possible targeted interventions are clearly
identified and satisfy Minnesota's postsecondary admissions requirements.
    (f) For students in grade 8 in the 2012-2013 school year and later, a school, district,
or charter school must place record on the high school transcript a student's current pass
status for each subject that has a required graduation assessment progress toward career
and college readiness, and for other students as soon as practicable.
    In addition, (g) The school board granting the students their diplomas may formally
decide to include a notation of high achievement on the high school diplomas of those
graduating seniors who, according to established school board criteria, demonstrate
exemplary academic achievement during high school.
(e) (h) The 3rd through 8th 7th grade computer-adaptive assessment results and grade
8 and high school test results shall be available to districts for diagnostic purposes affecting
student learning and district instruction and curriculum, and for establishing educational
accountability. The commissioner must establish empirically derived benchmarks on
adaptive assessments in grades 3 through 7 that reveal a trajectory toward career and
college readiness. The commissioner must disseminate to the public the computer-adaptive
assessments, grade 8, and high school test results upon receiving those results.
    (f) (i) The 3rd through 8th grade grades 3 through 7 computer-adaptive assessments
and grade 8 and high school tests must be aligned with state academic standards. The
commissioner shall determine the testing process and the order of administration.
The statewide results shall be aggregated at the site and district level, consistent with
subdivision 1a.
    (g) In addition to the testing and reporting requirements under this section, (j) The
commissioner shall include the following components in the statewide public reporting
system:
    (1) uniform statewide testing computer-adaptive assessments of all students in
grades 3 through 8 7 and testing at the grade 8 and high school level levels that provides
appropriate, technically sound accommodations or alternate assessments;
    (2) educational indicators that can be aggregated and compared across school
districts and across time on a statewide basis, including average daily attendance, high
school graduation rates, and high school drop-out rates by age and grade level;
    (3) state results on the American College Test; and
    (4) state results from participation in the National Assessment of Educational
Progress so that the state can benchmark its performance against the nation and other
states, and, where possible, against other countries, and contribute to the national effort
to monitor achievement.
EFFECTIVE DATE.This section is effective the day following final enactment
and applies to the 2013-2014 school year and later, except that paragraph (a) applies
the day following final enactment and the requirements for using computer-adaptive
mathematics and reading assessments for grades 3 through 7 apply in the 2015-2016
school year and later. The series of assessments contracted for under paragraph (d) apply
in the 2014-2015 school year and later.

    Sec. 13. Minnesota Statutes 2012, section 120B.30, subdivision 1a, is amended to read:
    Subd. 1a. Statewide and local assessments; results. (a) For purposes of this
section, the following definitions have the meanings given them.
(1) "Computer-adaptive assessments" means fully adaptive assessments.
(2) "Fully adaptive assessments" include test items that are on-grade level and items
that may be above or below a student's grade level.
(3) "On-grade level" test items contain subject area content that is aligned to state
academic standards for the grade level of the student taking the assessment.
(4) "Above-grade level" test items contain subject area content that is above the
grade level of the student taking the assessment and is considered aligned with state
academic standards to the extent it is aligned with content represented in state academic
standards above the grade level of the student taking the assessment. Notwithstanding
the student's grade level, administering above-grade level test items to a student does not
violate the requirement that state assessments must be aligned with state standards.
(5) "Below-grade level" test items contain subject area content that is below the
grade level of the student taking the test and is considered aligned with state academic
standards to the extent it is aligned with content represented in state academic standards
below the student's current grade level. Notwithstanding the student's grade level,
administering below-grade level test items to a student does not violate the requirement
that state assessments must be aligned with state standards.
(b) The commissioner must use fully adaptive mathematics and reading assessments
for grades 3 through 7 beginning in the 2015-2016 school year and later.
(c) For purposes of conforming with existing federal educational accountability
requirements, the commissioner must develop and implement computer-adaptive reading
and mathematics assessments for grades 3 through 8 7, state-developed grade 8 and
high school reading and mathematics tests aligned with state academic standards, and
science assessments under clause (2) that districts and sites must use to monitor student
growth toward achieving those standards. The commissioner must not develop statewide
assessments for academic standards in social studies, health and physical education, and
the arts. The commissioner must require:
    (1) annual computer-adaptive reading and mathematics assessments in grades 3
through 8 7, and grade 8 and high school reading and mathematics tests; and
    (2) annual science assessments in one grade in the grades 3 through 5 span, the
grades 6 through 8 span, and a life sciences assessment in the grades 9 through 12 span,
and the commissioner must not require students to achieve a passing score on high school
science assessments as a condition of receiving a high school diploma.
(d) The commissioner must ensure that for annual computer-adaptive assessments:
(1) individual student performance data and achievement reports are available
within three school days of when students take an assessment except in a year when an
assessment reflects new performance standards;
(2) growth information is available for each student from the student's first
assessment to each proximate assessment using a constant measurement scale;
(3) parents, teachers, and school administrators are able to use elementary and
middle school student performance data to project students' secondary and postsecondary
achievement; and
(4) useful diagnostic information about areas of students' academic strengths and
weaknesses is available to teachers and school administrators for improving student
instruction and indicating the specific skills and concepts that should be introduced and
developed for students at given performance levels, organized by strands within subject
areas, and aligned to state academic standards.
    (b) (e) The commissioner must ensure that all statewide state tests administered to
elementary and secondary students measure students' academic knowledge and skills and
not students' values, attitudes, and beliefs.
    (c) (f) Reporting of state assessment results must:
    (1) provide timely, useful, and understandable information on the performance of
individual students, schools, school districts, and the state;
    (2) include a value-added growth indicator of student achievement under section
120B.35, subdivision 3, paragraph (b); and
    (3)(i) for students enrolled in grade 8 before the 2005-2006 school year, determine
whether students have met the state's basic skills requirements; and
    (ii) for students enrolled in grade 8 in the 2005-2006 school year and later, determine
whether students have met the state's academic standards.
    (d) (g) Consistent with applicable federal law and subdivision 1, paragraph (d),
clause (1), the commissioner must include appropriate, technically sound accommodations
or alternative assessments for the very few students with disabilities for whom statewide
assessments are inappropriate and for English learners.
    (e) (h) A school, school district, and charter school must administer statewide
assessments under this section, as the assessments become available, to evaluate student
proficiency progress toward career and college readiness in the context of the state's grade
level academic standards. If a state assessment is not available, a school, school district,
and charter school must determine locally if a student has met the required academic
standards. A school, school district, or charter school may use a student's performance
on a statewide assessment as one of multiple criteria to determine grade promotion or
retention. A school, school district, or charter school may use a high school student's
performance on a statewide assessment as a percentage of the student's final grade in a
course, or place a student's assessment score on the student's transcript.
EFFECTIVE DATE.This section is effective for the 2013-2014 school year and
later except the requirements for using computer-adaptive mathematics and reading
assessments for grades 3 through 7 apply in the 2015-2016 school year and later. Results
related to career and college readiness benchmarks apply in the 2014-2015 school year
and later.

    Sec. 14. Minnesota Statutes 2012, section 120B.31, subdivision 1, is amended to read:
    Subdivision 1. Educational accountability and public reporting. Consistent
with the direction to adopt statewide academic standards under section 120B.02, the
department, in consultation with education and other system stakeholders, must establish a
coordinated and comprehensive system of educational accountability and public reporting
that promotes greater academic achievement, preparation for higher academic education,
preparation for the world of work, citizenship under sections 120B.021, subdivision 1,
clause (4), and 120B.024, paragraph (a), clause (4), and the arts.

    Sec. 15. Minnesota Statutes 2012, section 120B.35, subdivision 3, is amended to read:
    Subd. 3. State growth target; other state measures. (a) The state's educational
assessment system measuring individual students' educational growth is based on
indicators of achievement growth that show an individual student's prior achievement.
Indicators of achievement and prior achievement must be based on highly reliable
statewide or districtwide assessments.
(b) The commissioner, in consultation with a stakeholder group that includes
assessment and evaluation directors and staff and researchers must implement a model
that uses a value-added growth indicator and includes criteria for identifying schools
and school districts that demonstrate medium and high growth under section 120B.299,
subdivisions 8 and 9, and may recommend other value-added measures under section
120B.299, subdivision 3. The model may be used to advance educators' professional
development and replicate programs that succeed in meeting students' diverse learning
needs. Data on individual teachers generated under the model are personnel data under
section 13.43. The model must allow users to:
(1) report student growth consistent with this paragraph; and
(2) for all student categories, report and compare aggregated and disaggregated state
growth data using the nine student categories identified under the federal 2001 No Child
Left Behind Act and two student gender categories of male and female, respectively,
following appropriate reporting practices to protect nonpublic student data.
The commissioner must report separate measures of student growth and proficiency,
consistent with this paragraph.
(c) When reporting student performance under section 120B.36, subdivision 1, the
commissioner annually, beginning July 1, 2011, must report two core measures indicating
the extent to which current high school graduates are being prepared for postsecondary
academic and career opportunities:
(1) a preparation measure indicating the number and percentage of high school
graduates in the most recent school year who completed course work important to
preparing them for postsecondary academic and career opportunities, consistent with
the core academic subjects required for admission to Minnesota's public colleges and
universities as determined by the Office of Higher Education under chapter 136A; and
(2) a rigorous coursework measure indicating the number and percentage of high
school graduates in the most recent school year who successfully completed one or more
college-level advanced placement, international baccalaureate, postsecondary enrollment
options including concurrent enrollment, other rigorous courses of study under section
120B.021, subdivision 1a, or industry certification courses or programs.
When reporting the core measures under clauses (1) and (2), the commissioner must also
analyze and report separate categories of information using the nine student categories
identified under the federal 2001 No Child Left Behind Act and two student gender
categories of male and female, respectively, following appropriate reporting practices to
protect nonpublic student data.
(d) When reporting student performance under section 120B.36, subdivision 1, the
commissioner annually, beginning July 1, 2014, must report summary data on school
safety and students' engagement and connection at school. The summary data under this
paragraph are separate from and must not be used for any purpose related to measuring
or evaluating the performance of classroom teachers. The commissioner, in consultation
with qualified experts on student engagement and connection and classroom teachers,
must identify highly reliable variables that generate summary data under this paragraph.
The summary data may be used at school, district, and state levels only. Any data on
individuals received, collected, or created that are used to generate the summary data
under this paragraph are nonpublic data under section 13.02, subdivision 9.
(e) For purposes of statewide educational accountability, the commissioner must
identify and report measures that demonstrate the success of learning year program
providers under sections 123A.05 and 124D.68, among other such providers, in improving
students' graduation outcomes. The commissioner, beginning July 1, 2015, must annually
report summary data on:
(1) the four- and six-year graduation rates of students under this paragraph;
(2) the percent of students under this paragraph whose progress and performance
levels are meeting career and college readiness benchmarks under section 120B.30,
subdivision 1; and
(3) the success that learning year program providers experience in:
(i) identifying at-risk and off-track student populations by grade;
(ii) providing successful prevention and intervention strategies for at-risk students;
(iii) providing successful recuperative and recovery or reenrollment strategies for
off-track students; and
(iv) improving the graduation outcomes of at-risk and off-track students.
The commissioner may include in the annual report summary data on other education
providers serving a majority of students eligible to participate in a learning year program.
EFFECTIVE DATE.Paragraph (e) applies to data that are collected in the
2014-2015 school year and later and reported annually beginning July 1, 2015.

    Sec. 16. Minnesota Statutes 2012, section 120B.36, subdivision 1, is amended to read:
    Subdivision 1. School performance report cards reports. (a) The commissioner
shall report student academic performance under section 120B.35, subdivision 2; the
percentages of students showing low, medium, and high growth under section 120B.35,
subdivision 3
, paragraph (b); school safety and student engagement and connection
under section 120B.35, subdivision 3, paragraph (d); rigorous coursework under section
120B.35, subdivision 3, paragraph (c); the percentage of students under section 120B.35,
subdivision 3, paragraph (b), clause (2), whose progress and performance levels are
meeting career and college readiness benchmarks under sections 120B.30, subdivision
1, and 120B.35, subdivision 3, paragraph (e); longitudinal data on the progress of
eligible districts in reducing disparities in students' academic achievement and racial and
economic integration under section 124D.861; two separate student-to-teacher ratios that
clearly indicate the definition of teacher consistent with sections 122A.06 and 122A.15
for purposes of determining these ratios; staff characteristics excluding salaries; student
enrollment demographics; district mobility; and extracurricular activities. The report also
must indicate a school's adequate yearly progress status under applicable federal law,
and must not set any designations applicable to high- and low-performing schools due
solely to adequate yearly progress status.
    (b) The commissioner shall develop, annually update, and post on the department
Web site school performance report cards reports.
    (c) The commissioner must make available performance report cards reports by the
beginning of each school year.
    (d) A school or district may appeal its adequate yearly progress status in writing to
the commissioner within 30 days of receiving the notice of its status. The commissioner's
decision to uphold or deny an appeal is final.
    (e) School performance report card data are nonpublic data under section 13.02,
subdivision 9
, until the commissioner publicly releases the data. The commissioner shall
annually post school performance report cards reports to the department's public Web
site no later than September 1, except that in years when the report card reflects reports
reflect new performance standards, the commissioner shall post the school performance
report cards reports no later than October 1.
EFFECTIVE DATE.This section is effective for the 2014-2015 school year and
later.

    Sec. 17. Minnesota Statutes 2012, section 124D.52, is amended by adding a
subdivision to read:
    Subd. 8. Standard high school diploma for adults. (a) The commissioner shall
adopt rules for providing a standard adult high school diploma to persons who:
(1) are not eligible for kindergarten through grade 12 services;
(2) do not have a high school diploma; and
(3) successfully complete an adult basic education program of instruction approved
by the commissioner of education necessary to earn an adult high school diploma.
(b) Persons participating in an approved adult basic education program of instruction
must demonstrate the competencies, knowledge, and skills sufficient to ensure that
postsecondary programs and institutions and potential employers regard persons with a
standard high school diploma and persons with a standard adult high school diploma as
equally well prepared and qualified graduates. Approved adult basic education programs
of instruction under this subdivision must issue a standard adult high school diploma to
persons who successfully demonstrate the competencies, knowledge, and skills required
by the program.
EFFECTIVE DATE.This section is effective July 1, 2014.

    Sec. 18. CAREER PATHWAYS AND TECHNICAL EDUCATION ADVISORY
TASK FORCE.
    Subdivision 1. Recommendations. (a) A career pathways and technical education
advisory task force is established to recommend to the Minnesota legislature, consistent
with Minnesota Statutes, sections 120B.30, subdivision 1, and 120B.35, subdivision 3,
how to structurally redesign secondary and postsecondary education to:
(1) improve secondary and postsecondary outcomes for students and adult learners;
(2) align secondary and postsecondary education programs serving students and
adult learners;
(3) align secondary and postsecondary education programs and Minnesota's
workforce needs; and
(4) measure and evaluate the combined efficacy of Minnesota's public kindergarten
through grade 12 and postsecondary education programs.
(b) Advisory task force members, in preparing these recommendations, must
seek the advice of education providers, employers, policy makers, and other interested
stakeholders and must at least consider how to:
(1) better inform students about career options, occupational trends, and educational
paths leading to viable and rewarding careers and reduce the gap between the demand for
and preparation of a skilled Minnesota workforce;
(2) in consultation with a student's family, develop and periodically adapt, as
needed, an education and work plan for each student aligned with the student's personal
and professional interests, abilities, skills, and aspirations;
(3) improve monitoring of high school students' progress with targeted interventions
and support and remove the need for remedial instruction;
(4) increase and accelerate opportunities for secondary school students to earn
postsecondary credits leading to a certificate, industry license, or degree;
(5) better align high school courses and expectations and postsecondary
credit-bearing courses;
(6) better align high school standards and assessments, postsecondary readiness
measures and entrance requirements, and the expectations of Minnesota employers;
(7) increase the rates at which students complete a postsecondary certificate,
industry license, or degree; and
(8) provide graduates of two-year and four-year postsecondary institutions with the
foundational skills needed for civic engagement, ongoing employment, and continuous
learning.
    Subd. 2. Membership. The Career Pathways Advisory Task Force shall have 15
members appointed by July 15, 2013, as follows:
(1) one member appointed by the Minnesota Association of Career and Technical
Administrators;
(2) one member appointed by the Minnesota Association for Career and Technical
Education;
(3) one member appointed by the University of Minnesota who is a faculty member
working to develop career and technical educators in Minnesota;
(4) one member appointed by the Minnesota State Colleges and Universities who is
a faculty member working to develop career and technical educators in Minnesota;
(5) one member appointed by the National Research Center for Career and Technical
Education;
(6) one member appointed by the Minnesota Department of Education;
(7) one member appointed by the Minnesota Board of Teaching;
(8) one member appointed by the Minnesota Association of Colleges for Teacher
Education;
(9) one member appointed by the Minnesota State Colleges and Universities from
faculty for foundational skills and general education;
(10) one member representing licensed career and technical education teachers
appointed by Education Minnesota;
(11) one member appointed by the commissioner of the Minnesota Department of
Employment and Economic Development;
(12) one member appointed by the Minnesota Chamber of Commerce;
(13) one member appointed by the Minnesota Business Partnership;
(14) one member appointed by the Minnesota Secondary School Principals
Association;
(15) one member appointed by the Minnesota Association of School Administrators;
(16) one member appointed by the Minnesota School Counselors Association;
(17) one member appointed by the Minnesota Association of Charter Schools; and
(18) four members appointed by the commissioner of education who have expertise
in any of the areas with which the task force has been charged in subdivision 1.
    Subd. 3. Terms. Each member shall serve until the task force sunsets, unless
replaced by their appointing authority.
    Subd. 4. First meeting; acting chair; chair. The commissioner of education shall
convene the first meeting by August 15, 2013, and shall act as chair until the task force
elects a chair from among its members at the first meeting.
    Subd. 5. Staff; technical assistance. The commissioner of education, on request
by the task force, will provide technical assistance and provide staff assistance sufficient
for the task force to carry out its duties.
    Subd. 6. Report. By February 15, 2014, the task force shall submit a written
report describing its recommendations to the chairs and ranking minority members of the
legislative committees and divisions with primary jurisdiction over kindergarten through
grade 12 education.
    Subd. 7. Sunset. The task force expires the day after the task force reports to the
legislature, or February 15, 2014, whichever is earlier.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 19. STANDARD ADULT HIGH SCHOOL DIPLOMA ADVISORY TASK
FORCE.
    Subdivision 1. Establishment. The commissioner of education shall appoint a
nine-member advisory task force to recommend programmatic requirements for adult
basic education programs of instruction leading to a standard adult high school diploma
under Minnesota Statutes, section 124D.52, subdivision 8.
    Subd. 2. Membership. The commissioner of education must appoint representatives
from the following organizations to the task force by July 1, 2013:
(1) one employee of the Department of Education with expertise in adult basic
education;
(2) five administrators and teachers with expertise in development of education
curriculum from local adult basic education programs located in rural, suburban, and
urban areas of the state, at least one of whom represents the Literacy Action network;
(3) one employee of the Minnesota State Colleges and Universities with expertise
in adult basic education;
(4) one employee of the Department of Employment and Economic Development
with expertise in adult basic education and employment; and
(5) one member of the Minnesota Chamber of Commerce familiar with adult basic
education programs under Minnesota Statutes, section 124D.52.
    Subd. 3. Duties. The duties of the task force shall include:
(1) reviewing "Minnesota Adult Secondary Credential: a Student Strategy for
Workforce Readiness and Individual Prosperity," a report submitted in 2012 by the
Minnesota Adult Secondary Task Force, and other relevant materials; and
(2) developing specific criteria to be used in awarding the new adult diploma.
    Subd. 4. First meeting. The commissioner of education must convene the first
meeting of the task force by August 1, 2013.
    Subd. 5. Chair. The commissioner shall appoint a chair.
    Subd. 6. Assistance. The commissioner, upon request, must provide technical
assistance to task force members.
    Subd. 7. Report. By February 1, 2014, the task force must submit its
recommendations to the commissioner of education for providing a standard adult high
school diploma to persons who are not eligible for kindergarten through grade 12 services,
who do not have a high school diploma, and who successfully complete an approved adult
basic education program of instruction necessary to earn an adult high school diploma.
The commissioner must consider these recommendations when adopting rules under
Minnesota Statutes, section 124D.52, subdivision 8.
    Subd. 8. Sunset. The task force sunsets the day after submitting its report under
subdivision 7, or February 2, 2014, whichever is earlier.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 20. APPROPRIATIONS.
    Subdivision 1. Minnesota Department of Education. The sums indicated in this
section are appropriated from the general fund to the Department of Education for the
fiscal years designated.
    Subd. 2. Statewide testing and reporting system. For the statewide testing and
reporting system under Minnesota Statutes, section 120B.30:

$
15,955,000
.....
2014

$
21,001,000
.....
2015
Any balance in the first year does not cancel but is available in the second year.
    Subd. 3. Educational planning and assessment system (EPAS) program. For
the educational planning and assessment system program under Minnesota Statutes,
section 120B.128:

$
829,000
.....
2014

$
0
.....
2015
Any balance in the first year does not cancel but is available in the second year.

    Sec. 21. REVISOR'S INSTRUCTION.
The revisor of statutes shall renumber Minnesota Statutes, section 120B.023,
subdivision 2, as Minnesota Statutes, section 120B.021, subdivision 4. The revisor shall
make necessary cross-reference changes consistent with the renumbering.

    Sec. 22. REPEALER.
(a) Minnesota Rules, parts 3501.0505; 3501.0510; 3501.0515; 3501.0520;
3501.0525; 3501.0530; 3501.0535; 3501.0540; 3501.0545; and 3501.0550, are repealed.
(b) Minnesota Rules, parts 3501.0010; 3501.0020; 3501.0030, subparts 1, 2, 3, 4,
5, 6, 7, 9, 10, 11, 12, 13, 14, 15, and 16; 3501.0040; 3501.0050; 3501.0060; 3501.0090;
3501.0100; 3501.0110; 3501.0120; 3501.0130; 3501.0140; 3501.0150; 3501.0160;
3501.0170; 3501.0180; 3501.0200; 3501.0210; 3501.0220; 3501.0230; 3501.0240;
3501.0250; 3501.0270; 3501.0280, subparts 1 and 2; 3501.0290; 3501.1000; 3501.1020;
3501.1030; 3501.1040; 3501.1050; 3501.1110; 3501.1120; 3501.1130; 3501.1140;
3501.1150; 3501.1160; 3501.1170; 3501.1180; and 3501.1190, are repealed.
EFFECTIVE DATE.This section is effective the day following final enactment.

ARTICLE 3
EDUCATION EXCELLENCE

    Section 1. Minnesota Statutes 2012, section 120A.22, subdivision 5, is amended to read:
    Subd. 5. Ages and terms. (a) Every child between seven and 16 17 years of age must
receive instruction unless the child has graduated. Every child under the age of seven who
is enrolled in a half-day kindergarten, or a full-day kindergarten program on alternate days,
or other kindergarten programs shall receive instruction. Except as provided in subdivision
6, a parent may withdraw a child under the age of seven from enrollment at any time.
(b) A school district by annual board action may require children subject to this
subdivision to receive instruction in summer school. A district that acts to require children
to receive instruction in summer school shall establish at the time of its action the criteria
for determining which children must receive instruction.
(c) A pupil 16 years of age or older who meets the criteria of section 124D.68,
subdivision 2, may be assigned to an area learning center. Such assignment may be made
only after consultation with the principal, area learning center director, and parent or
guardian.
EFFECTIVE DATE.This section is effective for the 2014-2015 school year and
later.

    Sec. 2. Minnesota Statutes 2012, section 120A.22, subdivision 8, is amended to read:
    Subd. 8. Withdrawal from school. Any student between 16 and 18 who is 17 years
old who seeks to withdraw from school, and the student's parent or guardian must:
(1) attend a meeting with school personnel to discuss the educational opportunities
available to the student, including alternative educational opportunities; and
(2) sign a written election to withdraw from school.

    Sec. 3. Minnesota Statutes 2012, section 120A.22, subdivision 11, is amended to read:
    Subd. 11. Assessment of performance. (a) Each year the performance of every
child ages seven through 16 and every child ages 16 through 17 for which an initial
report was filed pursuant to section 120A.24, subdivision 1, after the child is 16 and who
is not enrolled in a public school must be assessed using a nationally norm-referenced
standardized achievement examination. The superintendent of the district in which the
child receives instruction and the person in charge of the child's instruction must agree about
the specific examination to be used and the administration and location of the examination.
(b) To the extent the examination in paragraph (a) does not provide assessment in
all of the subject areas in subdivision 9, the parent must assess the child's performance
in the applicable subject area. This requirement applies only to a parent who provides
instruction and does not meet the requirements of subdivision 10, clause (1), (2), or (3).
(c) If the results of the assessments in paragraphs (a) and (b) indicate that the
child's performance on the total battery score is at or below the 30th percentile or one
grade level below the performance level for children of the same age, the parent must
obtain additional evaluation of the child's abilities and performance for the purpose of
determining whether the child has learning problems.
(d) A child receiving instruction from a nonpublic school, person, or institution that
is accredited by an accrediting agency, recognized according to section 123B.445, or
recognized by the commissioner, is exempt from the requirements of this subdivision.
EFFECTIVE DATE.This section is effective for the 2014-2015 school year and
later.

    Sec. 4. Minnesota Statutes 2012, section 120A.22, subdivision 12, is amended to read:
    Subd. 12. Legitimate exemptions. (a) A parent, guardian, or other person
having control of a child may apply to a school district to have the child excused from
attendance for the whole or any part of the time school is in session during any school
year. Application may be made to any member of the board, a truant officer, a principal,
or the superintendent. The school district may state in its school attendance policy that
it may ask the student's parent or legal guardian to verify in writing the reason for
the child's absence from school. A note from a physician or a licensed mental health
professional stating that the child cannot attend school is a valid excuse. The board of the
district in which the child resides may approve the application upon the following being
demonstrated to the satisfaction of that board:
(1) that the child's physical or mental health is such as to prevent attendance at
school or application to study for the period required, which includes:
(i) child illness, medical, dental, orthodontic, or counseling appointments;
(ii) family emergencies;
(iii) the death or serious illness or funeral of an immediate family member;
(iv) active duty in any military branch of the United States;
(v) the child has a condition that requires ongoing treatment for a mental health
diagnosis; or
(vi) other exemptions included in the district's school attendance policy;
(2) that the child has already completed state and district standards required for
graduation from high school; or
(3) that it is the wish of the parent, guardian, or other person having control of the
child, that the child attend for a period or periods not exceeding in the aggregate three
hours in any week, a school for religious instruction conducted and maintained by some
church, or association of churches, or any Sunday school association incorporated under
the laws of this state, or any auxiliary thereof. This school for religious instruction must
be conducted and maintained in a place other than a public school building, and it must
not, in whole or in part, be conducted and maintained at public expense. However, a child
may be absent from school on such days as the child attends upon instruction according to
the ordinances of some church.
(b) Notwithstanding subdivision 6, paragraph (a), a parent may withdraw a child
from an all-day, every-day kindergarten program and put their child in a half-day program,
if offered, or an alternate-day program without being truant. A school board must excuse a
kindergarten child from a part of a school day at the request of the child's parent.

    Sec. 5. Minnesota Statutes 2012, section 120A.24, subdivision 1, is amended to read:
    Subdivision 1. Reports to superintendent. (a) The person or nonpublic school in
charge of providing instruction to a child must submit to the superintendent of the district
in which the child resides the name, birth date, and address of the child; the annual tests
intended to be used under section 120A.22, subdivision 11, if required; the name of each
instructor; and evidence of compliance with one of the requirements specified in section
120A.22, subdivision 10:
(1) by October 1 of the first school year the child receives instruction after reaching
the age of seven;
(2) within 15 days of when a parent withdraws a child from public school after
age seven to provide instruction in a nonpublic school that is not accredited by a
state-recognized accredited agency;
(3) within 15 days of moving out of a district; and
(4) by October 1 after a new resident district is established.
(b) The person or nonpublic school in charge of providing instruction to a child
between the ages of seven and 16 and every child ages 16 through 17 for which an
initial report was filed pursuant to this subdivision after the child is 16 must submit, by
October 1 of each school year, a letter of intent to continue to provide instruction under
this section for all students under the person's or school's supervision and any changes to
the information required in paragraph (a) for each student.
(c) The superintendent may collect the required information under this section
through an electronic or Web-based format, but must not require electronic submission of
information under this section from the person in charge of reporting under this subdivision.
EFFECTIVE DATE.This section is effective for the 2014-2015 school year and
later.

    Sec. 6. Minnesota Statutes 2012, section 121A.22, subdivision 2, is amended to read:
    Subd. 2. Exclusions. In addition, this section does not apply to drugs or medicine
that are:
(1) purchased without a prescription;
(2) used by a pupil who is 18 years old or older;
(3) used in connection with services for which a minor may give effective consent,
including section 144.343, subdivision 1, and any other law;
(4) used in situations in which, in the judgment of the school personnel who are
present or available, the risk to the pupil's life or health is of such a nature that drugs or
medicine should be given without delay;
(5) used off the school grounds;
(6) used in connection with athletics or extra curricular activities;
(7) used in connection with activities that occur before or after the regular school day;
(8) provided or administered by a public health agency to prevent or control an
illness or a disease outbreak as provided for in sections 144.05 and 144.12;
(9) prescription asthma or reactive airway disease medications self-administered by
a pupil with an asthma inhaler if the district has received a written authorization from the
pupil's parent permitting the pupil to self-administer the medication, the inhaler is properly
labeled for that student, and the parent has not requested school personnel to administer
the medication to the pupil. The parent must submit written authorization for the pupil to
self-administer the medication each school year; or
(10) prescription nonsyringe injectors of epinephrine auto-injectors, consistent with
section 121A.2205, if the parent and prescribing medical professional annually inform
the pupil's school in writing that (i) the pupil may possess the epinephrine or (ii) the
pupil is unable to possess the epinephrine and requires immediate access to nonsyringe
injectors of epinephrine auto-injectors that the parent provides properly labeled to the
school for the pupil as needed.

    Sec. 7. Minnesota Statutes 2012, section 121A.2205, is amended to read:
121A.2205 POSSESSION AND USE OF NONSYRINGE INJECTORS OF
EPINEPHRINE AUTO-INJECTORS; MODEL POLICY.
    Subdivision 1. Definitions. As used in this section:
(1) "administer" means the direct application of an epinephrine auto-injector to
the body of an individual;
(2) "epinephrine auto-injector" means a device that automatically injects a
premeasured dose of epinephrine; and
(3) "school" means a public school under section 120A.22, subdivision 4, or a
nonpublic school, excluding a home school, under section 120A.22, subdivision 4, that
is subject to the federal Americans with Disabilities Act.
    Subd. 2. Plan for use of epinephrine auto-injectors. (a) At the start of each school
year or at the time a student enrolls in school, whichever is first, a student's parent, school
staff, including those responsible for student health care, and the prescribing medical
professional must develop and implement an individualized written health plan for a
student who is prescribed nonsyringe injectors of epinephrine auto-injectors that enables
the student to:
(1) possess nonsyringe injectors of epinephrine auto-injectors; or
(2) if the parent and prescribing medical professional determine the student is unable
to possess the epinephrine, have immediate access to nonsyringe injectors of epinephrine
auto-injectors in close proximity to the student at all times during the instructional day.
The plan must designate the school staff responsible for implementing the student's
health plan, including recognizing anaphylaxis and administering nonsyringe injectors of
epinephrine auto-injectors when required, consistent with section 121A.22, subdivision 2,
clause (10). This health plan may be included in a student's 504 plan.
(b) A school under this section is a public school under section 120A.22, subdivision
4
, or a nonpublic school, excluding a home school, under section 120A.22, subdivision 4,
that is subject to the federal Americans with Disabilities Act. Other nonpublic schools are
encouraged to develop and implement an individualized written health plan for students
requiring nonsyringe injectors of epinephrine auto-injectors, consistent with this section
and section 121A.22, subdivision 2, clause (10).
(c) A school district and its agents and employees are immune from liability for
any act or failure to act, made in good faith, in implementing this section and section
121A.2207.
(d) The education commissioner may develop and transmit to interested schools a
model policy and individualized health plan form consistent with this section and federal
504 plan requirements. The policy and form may:
(1) assess a student's ability to safely possess nonsyringe injectors of epinephrine
auto-injectors;
(2) identify staff training needs related to recognizing anaphylaxis and administering
epinephrine when needed;
(3) accommodate a student's need to possess or have immediate access to nonsyringe
injectors of epinephrine auto-injectors in close proximity to the student at all times during
the instructional day; and
(4) ensure that the student's parent provides properly labeled nonsyringe injectors of
epinephrine auto-injectors to the school for the student as needed.
(e) Additional nonsyringe injectors of epinephrine auto-injectors may be available in
school first aid kits.
(f) The school board of the school district must define instructional day for the
purposes of this section.

    Sec. 8. [121A.2207] LIFE-THREATENING ALLERGIES IN SCHOOLS;
STOCK SUPPLY OF EPINEPHRINE AUTO-INJECTORS.
    Subdivision 1. Districts and schools permitted to maintain supply.
Notwithstanding section 151.37, districts and schools may obtain and possess epinephrine
auto-injectors to be maintained and administered by school personnel to a student or
other individual if, in good faith, it is determined that person is experiencing anaphylaxis
regardless of whether the student or other individual has a prescription for an epinephrine
auto-injector. The administration of an epinephrine auto-injector in accordance with
this section is not the practice of medicine.
    Subd. 2. Arrangements with manufacturers. A district or school may enter into
arrangements with manufacturers of epinephrine auto-injectors to obtain epinephrine
auto-injectors at fair-market, free, or reduced prices. A third party, other than a
manufacturer or supplier, may pay for a school's supply of epinephrine auto-injectors.

    Sec. 9. Minnesota Statutes 2012, section 121A.39, is amended to read:
121A.39 SCHOOL COUNSELORS.
(a) A school district is strongly encouraged to have an adequate student-to-counselor
ratio for its students beginning in the 2015-2016 school year and later.
(b) A school counselor shall assist a student in meeting the requirements for high
school graduation, college and career exploration, and selection, college affordability
planning, and successful transitions into postsecondary education or training.

    Sec. 10. Minnesota Statutes 2012, section 122A.09, subdivision 4, is amended to read:
    Subd. 4. License and rules. (a) The board must adopt rules to license public school
teachers and interns subject to chapter 14.
(b) The board must adopt rules requiring a person to pass a skills examination in
reading, writing, and mathematics as a requirement for initial teacher licensure, except
that the board may issue up to two additional temporary, one-year teaching licenses to an
otherwise qualified candidate who has not yet passed the skills exam. Such rules must
require college and universities offering a board-approved teacher preparation program to
provide remedial assistance to persons who did not achieve a qualifying score on the skills
examination, including those for whom English is a second language.
(c) The board must adopt rules to approve teacher preparation programs. The board,
upon the request of a postsecondary student preparing for teacher licensure or a licensed
graduate of a teacher preparation program, shall assist in resolving a dispute between the
person and a postsecondary institution providing a teacher preparation program when the
dispute involves an institution's recommendation for licensure affecting the person or the
person's credentials. At the board's discretion, assistance may include the application
of chapter 14.
(d) The board must provide the leadership and adopt rules for the redesign of teacher
education programs to implement a research based, results-oriented curriculum that
focuses on the skills teachers need in order to be effective. The board shall implement new
systems of teacher preparation program evaluation to assure program effectiveness based
on proficiency of graduates in demonstrating attainment of program outcomes. Teacher
preparation programs including alternative teacher preparation programs under section
122A.245, among other programs, must include a content-specific, board-approved,
performance-based assessment that measures teacher candidates in three areas: planning
for instruction and assessment; engaging students and supporting learning; and assessing
student learning.
(e) The board must adopt rules requiring candidates for initial licenses to pass an
examination of general pedagogical knowledge and examinations of licensure-specific
teaching skills. The rules shall be effective by September 1, 2001. The rules under this
paragraph also must require candidates for initial licenses to teach prekindergarten or
elementary students to pass, as part of the examination of licensure-specific teaching
skills, test items assessing the candidates' knowledge, skill, and ability in comprehensive,
scientifically based reading instruction under section 122A.06, subdivision 4, and their
knowledge and understanding of the foundations of reading development, the development
of reading comprehension, and reading assessment and instruction, and their ability to
integrate that knowledge and understanding.
(f) The board must adopt rules requiring teacher educators to work directly with
elementary or secondary school teachers in elementary or secondary schools to obtain
periodic exposure to the elementary or secondary teaching environment.
(g) The board must grant licenses to interns and to candidates for initial licenses
based on appropriate professional competencies that are aligned with the board's licensing
system and students' diverse learning needs. The board must include these licenses in a
statewide differentiated licensing system that creates new leadership roles for successful
experienced teachers premised on a collaborative professional culture dedicated to meeting
students' diverse learning needs in the 21st century and formalizes mentoring and induction
for newly licensed teachers that is provided through a teacher support framework.
(h) The board must design and implement an assessment system which requires a
candidate for an initial license and first continuing license to demonstrate the abilities
necessary to perform selected, representative teaching tasks at appropriate levels.
(i) The board must receive recommendations from local committees as established
by the board for the renewal of teaching licenses.
(j) The board must grant life licenses to those who qualify according to requirements
established by the board, and suspend or revoke licenses pursuant to sections 122A.20 and
214.10. The board must not establish any expiration date for application for life licenses.
(k) The board must adopt rules that require all licensed teachers who are renewing
their continuing license to include in their renewal requirements further preparation in
the areas of using positive behavior interventions and in accommodating, modifying, and
adapting curricula, materials, and strategies to appropriately meet the needs of individual
students and ensure adequate progress toward the state's graduation rule.
(l) In adopting rules to license public school teachers who provide health-related
services for disabled children, the board shall adopt rules consistent with license or
registration requirements of the commissioner of health and the health-related boards who
license personnel who perform similar services outside of the school.
(m) The board must adopt rules that require all licensed teachers who are renewing
their continuing license to include in their renewal requirements further reading
preparation, consistent with section 122A.06, subdivision 4. The rules do not take effect
until they are approved by law. Teachers who do not provide direct instruction including, at
least, counselors, school psychologists, school nurses, school social workers, audiovisual
directors and coordinators, and recreation personnel are exempt from this section.
(n) The board must adopt rules that require all licensed teachers who are renewing
their continuing license to include in their renewal requirements further preparation,
first, in understanding the key warning signs of early-onset mental illness in children
and adolescents and then, during subsequent licensure renewal periods, preparation may
include providing a more in-depth understanding of students' mental illness trauma,
accommodations for students' mental illness, parents' role in addressing students' mental
illness, Fetal Alcohol Spectrum Disorders, autism, the requirements of section 125A.0942
governing restrictive procedures, and de-escalation methods, among other similar topics.
EFFECTIVE DATE.Paragraph (b) is effective the day following final enactment.
Paragraph (n) is effective August 1, 2014.

    Sec. 11. Minnesota Statutes 2012, section 122A.18, subdivision 2, is amended to read:
    Subd. 2. Teacher and support personnel qualifications. (a) The Board of
Teaching must issue licenses under its jurisdiction to persons the board finds to be
qualified and competent for their respective positions.
(b) The board must require a person to pass an examination of skills in reading,
writing, and mathematics before being granted an initial teaching license to provide direct
instruction to pupils in prekindergarten, elementary, secondary, or special education
programs, except that the board may issue up to two additional temporary, one-year
teaching licenses to an otherwise qualified candidate who has not yet passed the skills
exam. The board must require colleges and universities offering a board approved teacher
preparation program to provide make available upon request remedial assistance that
includes a formal diagnostic component to persons enrolled in their institution who did
not achieve a qualifying score on the skills examination, including those for whom
English is a second language. The colleges and universities must provide make available
assistance in the specific academic areas of deficiency in which the person did not achieve
a qualifying score. School districts may make available upon request similar, appropriate,
and timely remedial assistance that includes a formal diagnostic component to those
persons employed by the district who completed their teacher education program, who did
not achieve a qualifying score on the skills examination, including those persons for whom
English is a second language and persons under section 122A.23, subdivision 2, paragraph
(h), who completed their teacher's education program outside the state of Minnesota,
and who received a temporary license to teach in Minnesota. The Board of Teaching
shall report annually to the education committees of the legislature on the total number
of teacher candidates during the most recent school year taking the skills examination,
the number who achieve a qualifying score on the examination, the number who do not
achieve a qualifying score on the examination, the distribution of all candidates' scores,
the number of candidates who have taken the examination at least once before, and the
number of candidates who have taken the examination at least once before and achieve
a qualifying score.
(c) The Board of Teaching must grant continuing licenses only to those persons who
have met board criteria for granting a continuing license, which includes passing the
skills examination in reading, writing, and mathematics consistent with paragraph (b) and
section 122A.09, subdivision 4, paragraph (b).
(d) All colleges and universities approved by the board of teaching to prepare
persons for teacher licensure must include in their teacher preparation programs a common
core of teaching knowledge and skills to be acquired by all persons recommended
for teacher licensure. This common core shall meet the standards developed by the
interstate new teacher assessment and support consortium in its 1992 "model standards for
beginning teacher licensing and development." Amendments to standards adopted under
this paragraph are covered by chapter 14. The board of teaching shall report annually to
the education committees of the legislature on the performance of teacher candidates
on common core assessments of knowledge and skills under this paragraph during the
most recent school year.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 12. Minnesota Statutes 2012, section 122A.23, subdivision 2, is amended to read:
    Subd. 2. Applicants licensed in other states. (a) Subject to the requirements of
sections 122A.18, subdivision 8, and 123B.03, the Board of Teaching must issue a teaching
license or a temporary teaching license under paragraphs (b) to (e) to an applicant who holds
at least a baccalaureate degree from a regionally accredited college or university and holds
or held a similar out-of-state teaching license that requires the applicant to successfully
complete a teacher preparation program approved by the issuing state, which includes
field-specific teaching methods and student teaching or essentially equivalent experience.
(b) The Board of Teaching must issue a teaching license to an applicant who:
(1) successfully completed all exams and human relations preparation components
required by the Board of Teaching; and
(2) holds or held an out-of-state teaching license to teach the same content field and
grade levels if the scope of the out-of-state license is no more than one grade level less
than a similar Minnesota license.
(c) The Board of Teaching, consistent with board rules and paragraph (h), must
issue up to three one-year temporary teaching licenses to an applicant who holds or held
an out-of-state teaching license to teach the same content field and grade levels, where
the scope of the out-of-state license is no more than one grade level less than a similar
Minnesota license, but has not successfully completed all exams and human relations
preparation components required by the Board of Teaching.
(d) The Board of Teaching, consistent with board rules, must issue up to three
one-year temporary teaching licenses to an applicant who:
(1) successfully completed all exams and human relations preparation components
required by the Board of Teaching; and
(2) holds or held an out-of-state teaching license to teach the same content field
and grade levels, where the scope of the out-of-state license is no more than one grade
level less than a similar Minnesota license, but has not completed field-specific teaching
methods or student teaching or equivalent experience.
The applicant may complete field-specific teaching methods and student teaching
or equivalent experience by successfully participating in a one-year school district
mentorship program consistent with board-adopted standards of effective practice and
Minnesota graduation requirements.
(e) The Board of Teaching must issue a temporary teaching license for a term of
up to three years only in the content field or grade levels specified in the out-of-state
license to an applicant who:
(1) successfully completed all exams and human relations preparation components
required by the Board of Teaching; and
(2) holds or held an out-of-state teaching license where the out-of-state license is
more limited in the content field or grade levels than a similar Minnesota license.
(f) The Board of Teaching must not issue to an applicant more than three one-year
temporary teaching licenses under this subdivision.
(g) The Board of Teaching must not issue a license under this subdivision if the
applicant has not attained the additional degrees, credentials, or licenses required in a
particular licensure field.
(h) The Board of Teaching must require an applicant for a teaching license or
a temporary teaching license under this subdivision to pass a skills examination in
reading, writing, and mathematics before the board issues the license. Consistent with
section 122A.18, subdivision 2, paragraph (b), and notwithstanding other provisions of
this subdivision, the board may issue up to two additional temporary, one-year teaching
licenses to an otherwise qualified applicant who has not yet passed the skills exam.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 13. Minnesota Statutes 2012, section 122A.28, subdivision 1, is amended to read:
    Subdivision 1. K-12 license to teach deaf and hard-of-hearing students;
relicensure. (a) The Board of Teaching must review and determine appropriate licensure
requirements for a candidate for a license or an applicant for a continuing license to teach
deaf and hard-of-hearing students in prekindergarten through grade 12. In addition to
other requirements, a candidate must demonstrate the minimum level of proficiency in
American sign language as determined by the board.
(b) Among other relicensure requirements, each teacher under this section must
complete 30 continuing education clock hours on hearing loss topics, including American
Sign Language, American Sign Language linguistics, or deaf culture, in each licensure
renewal period.
EFFECTIVE DATE.This section is effective August 1, 2013.

    Sec. 14. Minnesota Statutes 2012, section 122A.33, subdivision 3, is amended to read:
    Subd. 3. Notice of nonrenewal; opportunity to respond. A school board that
declines to renew the coaching contract of a licensed or nonlicensed head varsity coach
must notify the coach within 14 days of that decision. If the coach requests reasons for not
renewing the coaching contract, the board must give the coach its reasons in writing within
ten days of receiving the request. The existence of parent complaints must not be the sole
reason for a board not to renew a coaching contract. Upon request, the board must provide
the coach with a reasonable opportunity to respond to the reasons at a board meeting. The
hearing may be opened or closed at the election of the coach unless the board closes the
meeting under section 13D.05, subdivision 2, to discuss private data.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 15. Minnesota Statutes 2012, section 122A.40, subdivision 8, is amended to read:
    Subd. 8. Development, evaluation, and peer coaching for continuing contract
teachers. (a) To improve student learning and success, a school board and an exclusive
representative of the teachers in the district, consistent with paragraph (b), may develop
a teacher evaluation and peer review process for probationary and continuing contract
teachers through joint agreement. If a school board and the exclusive representative of the
teachers do not agree to an annual teacher evaluation and peer review process, then the
school board and the exclusive representative of the teachers must implement the plan
for evaluation and review under paragraph (c). The process must include having trained
observers serve as peer coaches or having teachers participate in professional learning
communities, consistent with paragraph (b).
(b) To develop, improve, and support qualified teachers and effective teaching
practices and improve student learning and success, the annual evaluation process for
teachers:
(1) must, for probationary teachers, provide for all evaluations required under
subdivision 5;
(2) must establish a three-year professional review cycle for each teacher that
includes an individual growth and development plan, a peer review process, the
opportunity to participate in a professional learning community under paragraph (a), and
at least one summative evaluation performed by a qualified and trained evaluator such as a
school administrator. For the years when a tenured teacher is not evaluated by a qualified
and trained evaluator, the teacher must be evaluated by a peer review;
(3) must be based on professional teaching standards established in rule;
(4) must coordinate staff development activities under sections 122A.60 and
122A.61 with this evaluation process and teachers' evaluation outcomes;
(5) may provide time during the school day and school year for peer coaching and
teacher collaboration;
(6) may include mentoring and induction programs;
(7) must include an option for teachers to develop and present a portfolio
demonstrating evidence of reflection and professional growth, consistent with section
122A.18, subdivision 4, paragraph (b), and include teachers' own performance assessment
based on student work samples and examples of teachers' work, which may include video
among other activities for the summative evaluation;
(8) must use an agreed upon teacher value-added assessment model for the grade
levels and subject areas for which value-added data are available and establish state or local
measures of student growth for the grade levels and subject areas for which value-added
data are not available as a basis for 35 percent of teacher evaluation results must use data
from valid and reliable assessments aligned to state and local academic standards and must
use state and local measures of student growth that may include value-added models or
student learning goals to determine 35 percent of teacher evaluation results;
(9) must use longitudinal data on student engagement and connection, and other
student outcome measures explicitly aligned with the elements of curriculum for which
teachers are responsible;
(10) must require qualified and trained evaluators such as school administrators to
perform summative evaluations;
(11) must give teachers not meeting professional teaching standards under clauses
(3) through (10) support to improve through a teacher improvement process that includes
established goals and timelines; and
(12) must discipline a teacher for not making adequate progress in the teacher
improvement process under clause (11) that may include a last chance warning,
termination, discharge, nonrenewal, transfer to a different position, a leave of absence, or
other discipline a school administrator determines is appropriate.
Data on individual teachers generated under this subdivision are personnel data
under section 13.43.
(c) The department, in consultation with parents who may represent parent
organizations and teacher and administrator representatives appointed by their respective
organizations, representing the Board of Teaching, the Minnesota Association of School
Administrators, the Minnesota School Boards Association, the Minnesota Elementary
and Secondary Principals Associations, Education Minnesota, and representatives of
the Minnesota Assessment Group, the Minnesota Business Partnership, the Minnesota
Chamber of Commerce, and Minnesota postsecondary institutions with research expertise
in teacher evaluation, must create and publish a teacher evaluation process that complies
with the requirements in paragraph (b) and applies to all teachers under this section and
section 122A.41 for whom no agreement exists under paragraph (a) for an annual teacher
evaluation and peer review process. The teacher evaluation process created under this
subdivision does not create additional due process rights for probationary teachers under
subdivision 5.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 16. Minnesota Statutes 2012, section 122A.41, subdivision 5, is amended to read:
    Subd. 5. Development, evaluation, and peer coaching for continuing contract
teachers. (a) To improve student learning and success, a school board and an exclusive
representative of the teachers in the district, consistent with paragraph (b), may develop an
annual teacher evaluation and peer review process for probationary and nonprobationary
teachers through joint agreement. If a school board and the exclusive representative of
the teachers in the district do not agree to an annual teacher evaluation and peer review
process, then the school board and the exclusive representative of the teachers must
implement the plan for evaluation and review developed under paragraph (c). The process
must include having trained observers serve as peer coaches or having teachers participate
in professional learning communities, consistent with paragraph (b).
(b) To develop, improve, and support qualified teachers and effective teaching
practices and improve student learning and success, the annual evaluation process for
teachers:
(1) must, for probationary teachers, provide for all evaluations required under
subdivision 2;
(2) must establish a three-year professional review cycle for each teacher that
includes an individual growth and development plan, a peer review process, the
opportunity to participate in a professional learning community under paragraph (a), and
at least one summative evaluation performed by a qualified and trained evaluator such
as a school administrator;
(3) must be based on professional teaching standards established in rule;
(4) must coordinate staff development activities under sections 122A.60 and
122A.61 with this evaluation process and teachers' evaluation outcomes;
(5) may provide time during the school day and school year for peer coaching and
teacher collaboration;
(6) may include mentoring and induction programs;
(7) must include an option for teachers to develop and present a portfolio
demonstrating evidence of reflection and professional growth, consistent with section
122A.18, subdivision 4, paragraph (b), and include teachers' own performance assessment
based on student work samples and examples of teachers' work, which may include video
among other activities for the summative evaluation;
(8) must use an agreed upon teacher value-added assessment model for the grade
levels and subject areas for which value-added data are available and establish state or local
measures of student growth for the grade levels and subject areas for which value-added
data are not available as a basis for 35 percent of teacher evaluation results must use data
from valid and reliable assessments aligned to state and local academic standards and must
use state and local measures of student growth that may include value-added models or
student learning goals to determine 35 percent of teacher evaluation results;
(9) must use longitudinal data on student engagement and connection and other
student outcome measures explicitly aligned with the elements of curriculum for which
teachers are responsible;
(10) must require qualified and trained evaluators such as school administrators to
perform summative evaluations;
(11) must give teachers not meeting professional teaching standards under clauses
(3) through (10) support to improve through a teacher improvement process that includes
established goals and timelines; and
(12) must discipline a teacher for not making adequate progress in the teacher
improvement process under clause (11) that may include a last chance warning,
termination, discharge, nonrenewal, transfer to a different position, a leave of absence, or
other discipline a school administrator determines is appropriate.
Data on individual teachers generated under this subdivision are personnel data
under section 13.43.
(c) The department, in consultation with parents who may represent parent
organizations and teacher and administrator representatives appointed by their respective
organizations, representing the Board of Teaching, the Minnesota Association of School
Administrators, the Minnesota School Boards Association, the Minnesota Elementary
and Secondary Principals Associations, Education Minnesota, and representatives of
the Minnesota Assessment Group, the Minnesota Business Partnership, the Minnesota
Chamber of Commerce, and Minnesota postsecondary institutions with research expertise
in teacher evaluation, must create and publish a teacher evaluation process that complies
with the requirements in paragraph (b) and applies to all teachers under this section and
section 122A.40 for whom no agreement exists under paragraph (a) for an annual teacher
evaluation and peer review process. The teacher evaluation process created under this
subdivision does not create additional due process rights for probationary teachers under
subdivision 2.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 17. Minnesota Statutes 2012, section 122A.415, is amended by adding a
subdivision to read:
    Subd. 4. Basic alternative teacher compensation aid. (a) For fiscal year 2015
and later, the basic alternative teacher compensation aid for a school with a plan approved
under section 122A.414, subdivision 2b, equals 65 percent of the alternative teacher
compensation revenue under subdivision 1. The basic alternative teacher compensation
aid for an intermediate school district or charter school with a plan approved under section
122A.414, subdivisions 2a and 2b, if the recipient is a charter school, equals $260 times
the number of pupils enrolled in the school on October 1 of the previous year, or on
October 1 of the current year for a charter school in the first year of operation, times
the ratio of the sum of the alternative teacher compensation aid and alternative teacher
compensation levy for all participating school districts to the maximum alternative teacher
compensation revenue for those districts under subdivision 1.
(b) Notwithstanding paragraph (a) and subdivision 1, the state total basic alternative
teacher compensation aid entitlement must not exceed $75,636,000 for fiscal year 2015
and later. The commissioner must limit the amount of alternative teacher compensation
aid approved under this section so as not to exceed these limits.
EFFECTIVE DATE.This section is effective for revenue in fiscal year 2015 and
later.

    Sec. 18. Minnesota Statutes 2012, section 122A.415, is amended by adding a
subdivision to read:
    Subd. 5. Alternative teacher compensation levy. For fiscal year 2015 and later,
the alternative teacher compensation levy for a district receiving basic alternative teacher
compensation aid equals the product of (1) the difference between the district's alternative
teacher compensation revenue and the district's basic alternative teacher compensation
aid, times (2) the lesser of one or the ratio of the district's adjusted net tax capacity per
adjusted pupil unit to $6,100.
EFFECTIVE DATE.This section is effective for revenue in fiscal year 2015 and
later.

    Sec. 19. Minnesota Statutes 2012, section 122A.415, is amended by adding a
subdivision to read:
    Subd. 6. Alternative teacher compensation equalization aid. (a) For fiscal year
2015 and later, a district's alternative teacher compensation equalization aid equals the
district's alternative teacher compensation revenue minus the district's basic alternative
teacher compensation aid minus the district's alternative teacher compensation levy. If a
district does not levy the entire amount permitted, the alternative teacher compensation
equalization aid must be reduced in proportion to the actual amount levied.
(b) A district's alternative teacher compensation aid equals the sum of the
district's basic alternative teacher compensation aid and the district's alternative teacher
compensation equalization aid.
EFFECTIVE DATE.This section is effective for revenue in fiscal year 2015 and
later.

    Sec. 20. Minnesota Statutes 2012, section 122A.61, subdivision 1, is amended to read:
    Subdivision 1. Staff development revenue. A district is required to reserve
an amount equal to at least two percent of the basic revenue under section 126C.10,
subdivision 2
, for in-service education for programs under section 120B.22, subdivision 2,
for staff development plans, including plans for challenging instructional activities and
experiences under section 122A.60, and for curriculum development and programs, other
in-service education, teachers' evaluation, teachers' workshops, teacher conferences, the
cost of substitute teachers staff development purposes, preservice and in-service education
for special education professionals and paraprofessionals, and other related costs for
staff development efforts. A district may annually waive the requirement to reserve their
basic revenue under this section if a majority vote of the licensed teachers in the district
and a majority vote of the school board agree to a resolution to waive the requirement.
A district in statutory operating debt is exempt from reserving basic revenue according
to this section. Districts may expend an additional amount of unreserved revenue for
staff development based on their needs.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 21. Minnesota Statutes 2012, section 124D.03, subdivision 12, is amended to read:
    Subd. 12. Termination of enrollment. A district may terminate the enrollment
of a nonresident student enrolled under this section or section 124D.08 at the end of a
school year if the student meets the definition of a habitual truant under section 260C.007,
subdivision 19
, the student has been provided appropriate services under chapter 260A,
and the student's case has been referred to juvenile court. A district may also terminate the
enrollment of a nonresident student over the age of 16 17 enrolled under this section if the
student is absent without lawful excuse for one or more periods on 15 school days and has
not lawfully withdrawn from school under section 120A.22, subdivision 8.
EFFECTIVE DATE.This section is effective for the 2014-2015 school year and
later.

    Sec. 22. Minnesota Statutes 2012, section 124D.095, subdivision 10, is amended to
read:
    Subd. 10. Online and Digital Learning Advisory Council. (a) An Online and
Digital Learning Advisory Council is established. The term for each council member shall
be three years. The advisory council is composed of 12 14 members from throughout the
state who have demonstrated experience with or interest in online learning. Two members
of the council must represent technology business. The remaining membership must
represent the following interests:
(1) superintendents;
(2) special education specialists;
(3) technology directors;
(4) teachers;
(5) rural, urban, and suburban school districts;
(6) supplemental programs;
(7) full-time programs;
(8) consortia;
(9) charter schools;
(10) Board of Teaching-approved teacher preparation programs; and
(11) parents.
The members of the council shall be appointed by the commissioner.
(b) The advisory council shall bring to the attention of the commissioner and the
legislature any matters related to online and digital learning and. The advisory council
shall provide input to the department and the legislature in online learning matters related,
but not restricted, to:
(1) quality assurance;
(2) teacher qualifications;
(3) program approval;
(4) special education;
(5) attendance;
(6) program design and requirements; and
(7) fair and equal access to programs.
(b) By June 30, 2013, (c) The Online Learning advisory council with the support of
the Minnesota Department of Education and the Minnesota Learning Commons shall:
(1) oversee the development and maintenance of a catalog of publicly available
digital learning content currently aligned to Minnesota academic standards to include:
(i) indexing of Minnesota academic standards with which curriculum is aligned;
(ii) a method for student and teacher users to provide evaluative feedback; and
(iii) a plan for ongoing maintenance; and
(2) recommend methods for including student performance data on the digital
learning content within the catalog.
(d) The advisory council shall also consider and provide input to the department and
legislature on digital learning matters including, but not limited to:
(1) a review and approval process to ensure the quality of online learning providers
based on teacher qualifications, support for special education services, definitions of
student attendance, program design, and equal access;
(2) effective use of technology and related instructional strategies to improve student
outcomes and advance students' 21st century skills and knowledge;
(3) measures to determine the impact of various forms of online and digital learning
in and outside of the classroom;
(4) resources to help parents, students, and schools choose among enrollment
options in a transparent education system;
(5) how to personalize or differentiate learning to meet the needs, abilities, and
learning styles of each student and support students' ownership of their learning so that all
students are digital learners and have access to high-quality digital curriculum in every
class and grade level;
(6) professional development in best practices to prepare current and future teachers,
other education leaders, and other school staff to use and evaluate the effectiveness of
digital tools and instructional strategies, provide personalized or differentiated instruction,
and focus on competency-based learning and advancement so that all educators have a
digital presence and use high-quality digital curriculum;
(7) support for collaborative efforts to leverage resources for digital instructional
content and curriculum; and
(8) barriers to improving the use of classroom technology and methods to ensure that
each student has access to a digital device and high-speed Internet at school and at home.
(e) The advisory council shall make policy recommendations to the commissioner
and committees of the legislature having jurisdiction over kindergarten through grade 12
education annually by December 15 of each year, including implementation plans based
on recommendations from previous councils and task forces related to online and digital
learning.
(c) (f) The Online and Digital Learning Advisory Council under this subdivision
expires June 30, 2013 2016.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 23. Minnesota Statutes 2012, section 124D.122, is amended to read:
124D.122 ESTABLISHMENT OF FLEXIBLE LEARNING YEAR PROGRAM.
The board of any district or a consortium of districts, with the approval of the
commissioner, may establish and operate a flexible learning year program in one or more of
the day or residential facilities for children with a disability within the district. Consortiums
may use a single application and evaluation process, though results, public hearings, and
board approvals must be obtained for each district as required under appropriate sections.

    Sec. 24. Minnesota Statutes 2012, section 124D.42, is amended to read:
124D.42 READING AND MATH CORPS.
    Subd. 6. Program training. The commission must, within available resources:
(1) orient each grantee organization in the nature, philosophy, and purpose of the
program;
(2) build an ethic of community service through general community service training;
and
(3) provide guidance on integrating programmatic-based measurement into program
models.
    Subd. 8. Minnesota reading corps program. (a) A Minnesota reading corps
program is established to provide ServeMinnesota Innovation AmeriCorps members with
a data-based problem-solving model of literacy instruction to use in helping to train local
Head Start program providers, other prekindergarten program providers, and staff in
schools with students in kindergarten through grade 3 to evaluate and teach early literacy
skills, including comprehensive, scientifically based reading instruction under section
122A.06, subdivision 4, to children age 3 to grade 3.
(b) Literacy programs under this subdivision must comply with the provisions
governing literacy program goals and data use under section 119A.50, subdivision 3,
paragraph (b).
(c) The commission must submit a biennial report to the committees of the
legislature with jurisdiction over kindergarten through grade 12 education that records and
evaluates program data to determine the efficacy of the programs under this subdivision.
    Subd. 9. Minnesota math corps program. (a) A Minnesota math corps program is
established to give ServeMinnesota AmeriCorps members a data-based problem-solving
model of mathematics instruction useful for providing elementary and middle school
students and their teachers with instructional support to meet state academic standards in
mathematics.
(b) The commission must submit a biennial report to the committees of the
legislature with jurisdiction over kindergarten through grade 12 education that records and
evaluates program data to determine the efficacy of the programs under this subdivision.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 25. Minnesota Statutes 2012, section 124D.65, subdivision 5, is amended to read:
    Subd. 5. School district EL revenue. (a) A district's English learner programs
revenue equals the product of (1) $700 in fiscal year 2004 and later $704 times (2) the
greater of 20 or the adjusted marginal cost average daily membership of eligible English
learners enrolled in the district during the current fiscal year.
(b) A pupil ceases to generate state English learner aid in the school year following
the school year in which the pupil attains the state cutoff score on a commissioner-provided
assessment that measures the pupil's emerging academic English.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 26. Minnesota Statutes 2012, section 124D.79, subdivision 1, is amended to read:
    Subdivision 1. Community involvement. The commissioner must provide for the
maximum involvement of the state committees on American Indian education, parents
of American Indian children, secondary students eligible to be served, American Indian
language and culture education teachers, American Indian teachers, teachers' aides,
representatives of community groups, and persons knowledgeable in the field of American
Indian education, in the formulation of policy and procedures relating to the administration
of sections 124D.71 to 124D.82. The commissioner must annually hold a field hearing on
Indian education to gather input from American Indian educators, parents, and students on
the state of American Indian education in Minnesota. Results of the hearing must be made
available to all 11 tribal nations for review and comment.

    Sec. 27. Minnesota Statutes 2012, section 124D.79, is amended by adding a
subdivision to read:
    Subd. 4. Consultation with the tribal nations education committee. (a) The
commissioner shall seek consultation with the Tribal Nations Education Committee on all
issues relating to American Indian education including:
(1) administration of the commissioner's duties under sections 124D.71 to 124D.82
and other programs;
(2) administration of other programs for the education of American Indian people, as
determined by the commissioner;
(3) awarding of scholarships to eligible American Indian students;
(4) administration of the commissioner's duties regarding awarding of American
Indian postsecondary preparation grants to school districts; and
(5) recommendations of education policy changes for American Indians.
(b) Membership in the Tribal Nations Education Committee is the sole discretion
of the committee and nothing in this subdivision gives the commissioner authority to
dictate committee membership.

    Sec. 28. [124D.791] INDIAN EDUCATION DIRECTOR.
    Subdivision 1. Appointment. An Indian education director shall be appointed by
the commissioner.
    Subd. 2. Qualifications. The commissioner shall select the Indian education
director on the basis of outstanding professional qualifications and knowledge of
American Indian education, culture, practices, and beliefs. The Indian education director
serves in the unclassified service. The commissioner may remove the Indian education
director for cause. The commissioner is encouraged to seek qualified applicants who
are enrolled members of a tribe.
    Subd. 3. Compensation. Compensation of the Indian education director shall be
established under chapter 15A.
    Subd. 4. Duties; powers. The Indian education director shall:
(1) serve as the liaison for the department with the Tribal Nations Education
Committee, the 11 reservations, the Minnesota Chippewa tribe, the Minnesota Indian
Affairs Council, and the urban advisory council;
(2) evaluate the state of American Indian education in Minnesota;
(3) engage the tribal bodies, community groups, parents of children eligible to be
served by American Indian education programs, American Indian administrators and
teachers, persons experienced in the training of teachers for American Indian education
programs, the tribally controlled schools, and other persons knowledgeable in the field of
American Indian education and seek their advice on policies that can improve the quality
of American Indian education;
(4) advise the commissioner on American Indian education issues, including:
(i) issues facing American Indian students;
(ii) policies for American Indian education;
(iii) awarding scholarships to eligible American Indian students and in administering
the commissioner's duties regarding awarding of American Indian postsecondary
preparation grants to school districts; and
(iv) administration of the commissioner's duties under sections 124D.71 to 124D.82
and other programs for the education of American Indian people;
(5) propose to the commissioner legislative changes that will improve the quality
of American Indian education;
(6) develop a strategic plan and a long-term framework for American Indian
education, in conjunction with the Minnesota Indian Affairs Council, that is updated every
five years and implemented by the commissioner, with goals to:
(i) increase American Indian student achievement, including increased levels of
proficiency and growth on statewide accountability assessments;
(ii) increase the number of American Indian teachers in public schools;
(iii) close the achievement gap between American Indian students and their more
advantaged peers;
(iv) increase the statewide graduation rate for American Indian students; and
(v) increase American Indian student placement in postsecondary programs and
the workforce; and
(7) keep the American Indian community informed about the work of the department
by reporting to the Tribal Nations Education Committee at each committee meeting.

    Sec. 29. [124D.861] ACHIEVEMENT AND INTEGRATION FOR MINNESOTA.
    Subdivision 1. Program to close the academic achievement and opportunity gap;
revenue uses. (a) The "Achievement and Integration for Minnesota" program is established
to pursue racial and economic integration and increase student academic achievement,
create equitable educational opportunities, and reduce academic disparities based on
students' diverse racial, ethnic, and economic backgrounds in Minnesota public schools.
(b) For purposes of this section and section 124D.862, "eligible district" means a
district required to submit a plan to the commissioner under Minnesota Rules governing
school desegregation and integration, or be a member of a multidistrict integration
collaborative that files a plan with the commissioner.
(c) Eligible districts must use the revenue under section 124D.862 to pursue
academic achievement and racial and economic integration through: (1) integrated
learning environments that prepare all students to be effective citizens and enhance
social cohesion; (2) policies and curricula and trained instructors, administrators, school
counselors, and other advocates to support and enhance integrated learning environments
under this section, including through magnet schools, innovative, research-based
instruction, differentiated instruction, and targeted interventions to improve achievement;
and (3) rigorous, career and college readiness programs for underserved student
populations, consistent with section 120B.30, subdivision 1; integrated learning
environments to increase student academic achievement; cultural fluency, competency,
and interaction; graduation and educational attainment rates; and parent involvement.
    Subd. 2. Plan implementation; components. (a) The school board of each eligible
district must formally develop and implement a long-term plan under this section. The
plan must be incorporated into the district's comprehensive strategic plan under section
120B.11. Plan components may include: innovative and integrated prekindergarten
through grade 12 learning environments that offer students school enrollment choices;
family engagement initiatives that involve families in their students' academic life
and success; professional development opportunities for teachers and administrators
focused on improving the academic achievement of all students; increased programmatic
opportunities focused on rigor and college and career readiness for underserved students,
including students enrolled in alternative learning centers under section 123A.05, public
alternative programs under section 126C.05, subdivision 15, and contract alternative
programs under section 124D.69, among other underserved students; or recruitment and
retention of teachers and administrators with diverse racial and ethnic backgrounds. The
plan must contain goals for: (1) reducing the disparities in academic achievement among
all students and specific categories of students under section 120B.35, subdivision 3,
paragraph (b), excluding the student categories of gender, disability, and English learners;
and (2) increasing racial and economic integration in schools and districts.
(b) Among other requirements, an eligible district must implement effective,
research-based interventions that include formative assessment practices to reduce the
disparities in student academic performance among the specific categories of students as
measured by student progress and growth on state reading and math assessments and
as aligned with section 120B.11.
(c) Eligible districts must create efficiencies and eliminate duplicative programs
and services under this section, which may include forming collaborations or a single,
seven-county metropolitan areawide partnership of eligible districts for this purpose.
    Subd. 3. Public engagement; progress report and budget process. (a) To
receive revenue under section 124D.862, the school board of an eligible district must
incorporate school and district plan components under section 120B.11 into the district's
comprehensive integration plan.
(b) A school board must hold at least one formal annual hearing to publicly report
its progress in realizing the goals identified in its plan. At the hearing, the board must
provide the public with longitudinal data demonstrating district and school progress in
reducing the disparities in student academic performance among the specified categories
of students and in realizing racial and economic integration, consistent with the district
plan and the measures in paragraph (a). At least 30 days before the formal hearing under
this paragraph, the board must post its plan, its preliminary analysis, relevant student
performance data, and other longitudinal data on the district Web site. A district must hold
one hearing to meet the hearing requirements of both this section and section 120B.11
(c) The district must submit a detailed budget to the commissioner by March 15 in
the year before it implements its plan. The commissioner must review, and approve or
disapprove the district's budget by June 1 of that year.
(d) The longitudinal data required under paragraph (a) must be based on student
growth and progress in reading and mathematics, as defined under section 120B.30,
subdivision 1, and student performance data and achievement reports from fully adaptive
reading and mathematics assessments for grades 3 through 7 beginning in the 2015-2016
school year under section 120B.30, subdivision 1a, and either (i) school enrollment choices,
(ii) the number of world language proficiency or high achievement certificates awarded
under section 120B.022, subdivision 1, paragraphs (b) and (c), or (iii) school safety and
students' engagement and connection at school under section 120B.35, subdivision 3,
paragraph (d). Additional longitudinal data may be based on: students' progress toward
career and college readiness under section 120B.30, subdivision 1; or rigorous coursework
completed under section 120B.35, subdivision 3, paragraph (c), clause (2).
    Subd. 4. Timeline and implementation. A board must approve its plan and
submit it to the department by March 15. If a district that is part of a multidistrict council
applies for revenue for a plan, the individual district shall not receive revenue unless it
ratifies the plan adopted by the multidistrict council. Each plan has a term of three years.
For the 2014-15 school year, an eligible district under this section must submit its plan
to the commissioner for review by March 15, 2014. For the 2013-14 school year only,
an eligible district may continue to implement its current plan until the commissioner
approves a new plan under this section.
    Subd. 5. Evaluation. The commissioner must evaluate the efficacy of district
plans in reducing the disparities in student academic performance among the specified
categories of students within the district, and in realizing racial and economic integration.
The commissioner shall report evaluation results to the kindergarten through grade 12
education committees of the legislature by February 1 of every odd-numbered year.

    Sec. 30. [124D.862] ACHIEVEMENT AND INTEGRATION REVENUE.
    Subdivision 1. Initial achievement and integration revenue. (a) An eligible
district's initial achievement and integration revenue equals the sum of (1) $350 times
the district's adjusted pupil units for that year times the ratio of the district's enrollment
of protected students for the previous school year to total enrollment for the previous
school year and (2) the greater of zero or 66 percent of the difference between the district's
integration revenue for fiscal year 2013 and the district's integration revenue for fiscal
year 2014 under clause (1).
(b) In each year, 0.3 percent of each district's initial achievement and integration
revenue is transferred to the department for the oversight and accountability activities
required under this section and section 124D.861.
    Subd. 2. Incentive revenue. An eligible school district's maximum incentive
revenue equals $10 per adjusted pupil unit. In order to receive this revenue, a district must
be implementing a voluntary plan to reduce racial and economic enrollment disparities
through intradistrict and interdistrict activities that have been approved as a part of the
district's achievement and integration plan.
    Subd. 3. Achievement and integration revenue. Achievement and integration
revenue equals the sum of initial achievement and integration revenue and incentive
revenue.
    Subd. 4. Achievement and integration aid. For fiscal year 2015 and later,
a district's achievement and integration aid equals 70 percent of its achievement and
integration revenue.
    Subd. 5. Achievement and integration levy. A district's achievement and
integration levy equals its achievement and integration revenue times the levy percentage
specified in H.F. No. 677 or a similarly styled bill. For Special School District No. 1,
Minneapolis, Independent School District No. 625, St. Paul, and Independent School
District No. 709, Duluth, 100 percent of the levy certified under this subdivision is shifted
into the prior calendar year for purposes of sections 123B.75, subdivision 5, and 127A.441.
    Subd. 6. Revenue uses. (a) At least 80 percent of a district's achievement and
integration revenue received under this section must be used for innovative and integrated
learning environments, school enrollment choices, family engagement activities, and other
approved programs providing direct services to students.
(b) Up to 20 percent of the revenue may be used for professional development and
staff development activities and placement services.
(c) No more than ten percent of the total amount of revenue may be spent on
administrative services.
    Subd. 7. Revenue reserved. Integration revenue received under this section must
be reserved and used only for the programs authorized in subdivision 2.
    Subd. 8. Commissioner authority to withhold revenue. (a) The commissioner
must review the results of each district's integration and achievement plan by August 1 at
the end of the third year of implementing the plan and determine if the district met its goals.
(b) If a district met its goals, it may submit a new three-year plan to the commissioner
for review.
(c) If a district has not met its goals, the commissioner must:
(1) develop a district improvement plan and timeline, in consultation with the
affected district, that identifies strategies and practices designed to meet the district's goals
under this section and section 120B.11; and
(2) use up to 20 percent of the district's integration revenue, until the district's goals
are reached, to implement the improvement plan.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2014 and
later. Subdivision 5 is effective for taxes payable in 2014 only.

    Sec. 31. Minnesota Statutes 2012, section 260C.007, subdivision 19, is amended to read:
    Subd. 19. Habitual truant. "Habitual truant" means a child under the age of 16 17
years who is absent from attendance at school without lawful excuse for seven school days
per school year if the child is in elementary school or for one or more class periods on
seven school days per school year if the child is in middle school, junior high school, or
high school, or a child who is 16 or 17 years of age who is absent from attendance at school
without lawful excuse for one or more class periods on seven school days per school year
and who has not lawfully withdrawn from school under section 120A.22, subdivision 8.
EFFECTIVE DATE.This section is effective for the 2014-2015 school year and
later.

    Sec. 32. ACHIEVEMENT AND INTEGRATION; RECOMMENDATIONS FOR
CONFORMING CHANGES.
The education commissioner shall review Minnesota Rules, parts 3535.0100 to
3535.0180, for consistency with Minnesota Statutes, sections 124D.861 and 124D.862,
and make recommendations to the education committees of the legislature by February 15,
2014, for revising the rules or amending applicable statutes.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 33. TEACHER LICENSURE ADVISORY TASK FORCE.
    Subdivision 1. Establishment and duties. (a) A Teacher Licensure Advisory Task
Force is established to make recommendations to the Board of Teaching, the education
commissioner, and the education committees of the legislature on requirements for:
teacher applicants to demonstrate mastery of reading, writing, and mathematics skills
through nationally normed assessments, a professional skills portfolio, or accredited
college coursework, among other methods of demonstrating skills mastery; and an
alternative licensure pathway for nonnative English speakers seeking licensure to teach in
a language immersion program.
(b) Task force recommendations on how teacher candidates demonstrate skills
mastery must encompass the following criteria:
(1) assessment content must be relevant to the teacher's subject area licensure;
(2) the scope of assessment content must be documented in sufficient detail to
correspond to a similarly detailed description of relevant public school curriculum;
(3) the scope of assessment content must be publicly available and readily accessible
on the Web site of the Board of Teaching and all Minnesota board-approved teacher
preparation programs and institutions;
(4) the Board of Teaching and all Minnesota board-approved teacher preparation
programs and institutions, upon request, must make available to the public at cost a written
review of the scope of assessment content;
(5) if applicable, and consistent with federal and state data practices laws including
the definition of summary data under Minnesota Statutes, section 13.02, subdivision 19,
the Board of Teaching and all Minnesota board-approved teacher preparation programs
and institutions annually must post on their Web site up-to-date longitudinal summary
data showing teacher candidates' overall passing rate and the passing rate for each
demographic group of teacher candidates taking a skills assessment in that school year and
in previous school years;
(6) reliable evidence showing assessment content is not culturally biased;
(7) the Board of Teaching and all Minnesota board-approved teacher preparation
programs and institutions must appropriately accommodate teacher candidates
with documented learning disabilities, including an appeals process if a request for
accommodations is denied; and
(8) if applicable, give timely, detailed item analysis feedback to teacher candidates
who do not pass the skills assessment sufficient for the candidate to target specific areas
of deficiency for appropriate remediation.
    Subd. 2. Membership. The Teacher Licensure Advisory Task Force shall be
composed of the following 20 members appointed by July 15, 2013:
(1) two members of the Board of Teaching appointed by the board's chair;
(2) two representatives from the Department of Education appointed by the
commissioner of education;
(3) two members of the house of representatives, one appointed by the speaker of the
house of representatives, and one appointed by the minority leader;
(4) two senators, one appointed by the Subcommittee on Committees of the
Committee on Rules and Administration, and one appointed by the minority leader;
(5) one elementary school principal from rural Minnesota appointed by the
Minnesota Elementary School Principals Association and one secondary school principal
from the seven-county metropolitan area appointed by the Minnesota Secondary School
Principals Association;
(6) one licensed and practicing public elementary school teacher and one licensed
and practicing secondary school teacher appointed by Education Minnesota;
(7) one teacher preparation faculty member each from the University of Minnesota
system appointed by the system president, the Minnesota State Colleges and Universities
system appointed by the system chancellor, and the Minnesota Private Colleges and
Universities system appointed by the Minnesota Private Colleges Council;
(8) one member of the nonpublic education council appointed by the council;
(9) one representative of Minnesota charter schools appointed by the Minnesota
Charter Schools Association;
(10) two representatives from the business community, appointed by the Minnesota
Chamber of Commerce; and
(11) one representative from the Minnesota School Boards Association.
    Subd. 3. First meeting; chair. The executive director of the Board of Teaching and
the commissioner of education jointly must convene the task force by August 1, 2013, and
shall appoint a chair from the membership of the task force.
    Subd. 4. Report. By February 1, 2014, task force members must submit to the
Board of Teaching, the education commissioner, and to the chairs and ranking minority
members of the senate and house of representatives committees and divisions with
primary jurisdiction over K-12 education their written recommendations on requirements
for teacher applicants to demonstrate mastery of reading, writing, and mathematics skills
and for an alternative licensure pathway for nonnative English speakers seeking licensure
to teach in a language immersion program.
    Subd. 5. Sunset. The task force shall sunset the day after submitting the report
under subdivision 6, or February 2, 2014, whichever is earlier.
    Subd. 6. Support. The executive director of the board and the commissioner of
education must provide technical assistance to task force members upon request.
    Subd. 7. Board of Teaching rules. The Board of Teaching must consider the
recommendations of the advisory task force and adopt revised rules by January 1, 2015,
governing the skills portion of the teacher licensure exam.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 34. STUDENT SUPPORT SERVICES; TEAM STAFFING APPROACH.
The commissioner of education shall develop and submit to the kindergarten
through grade 12 education policy and finance committees of the legislature by February
1, 2014, recommendations for providing access to licensed student support services,
including licensed school counselors, licensed school psychologists, licensed school
nurses, licensed school social workers, and licensed chemical health counselors, to public
school students throughout Minnesota using a multidisciplinary team staffing structure.
The recommendations must reflect:
(1) the extent to which students need academic, career, physical, emotional, social,
and early-onset mental health services to ensure educational achievement, safety and
enhancement of student's physical, emotional, and social well-being;
(2) the extent to which such services or teams do not exist, are incomplete or
inadequate given the number of students with unmet psychological, social, and health
needs that interfere with learning;
(3) existing funding streams and opportunities for additional funds to improve
students' access to needed licensed student support services; and
(4) caseloads and best practices when working to improve access to needed licensed
student support services.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 35. FISCAL YEAR 2014 ACHIEVEMENT AND INTEGRATION AID
AND LEVY.
    Subdivision 1. Achievement and integration aid. A district's achievement and
integration aid for fiscal year 2014 equals the difference between the district's achievement
and integration revenue and its achievement and integration levy for fiscal year 2014.
    Subd. 2. Achievement and integration levy. For fiscal year 2014 only, a district's
achievement and integration levy equals the amount the district was authorized to levy
under Laws 2011, First Special Session chapter 11, article 2, section 49, paragraph (f).
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2014
and later.

    Sec. 36. SUCCESS FOR THE FUTURE GRANT APPLICATIONS.
    A school district may receive a success for the future grant in the 2012-2013 school
year if the school district's grant application was postmarked on or before the Department
of Education's deadline date for application.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 37. APPROPRIATIONS.
    Subdivision 1. Department. The sums indicated in this section are appropriated
from the general fund to the Department of Education for the fiscal years designated.
    Subd. 2. Integration aid. For integration aid under Minnesota Statutes, section
124D.86:

$
17,197,000
.....
2014

$
0
.....
2015
The 2014 appropriation includes $17,197,000 for 2013 and $0 for 2014.
The 2015 appropriation includes $0 for 2014 and $0 for 2015.
    Subd. 3. Achievement and integration aid. For achievement and integration aid
under Minnesota Statutes, section 124D.862:

$
58,911,000
.....
2014

$
68,623,000
.....
2015
The 2014 appropriation includes $0 for 2013 and $58,911,000 for 2014.
The 2015 appropriation includes $9,273,000 for 2014 and $59,350,000 for 2015.
    Subd. 4. Literacy incentive aid. For literacy incentive aid under Minnesota
Statutes, section 124D.98:

$
52,514,000
.....
2014

$
53,818,000
.....
2015
The 2014 appropriation includes $6,607,000 for 2013 and $45,907,000 for 2014.
The 2015 appropriation includes $7,225,000 for 2014 and $46,593,000 for 2015.
    Subd. 5. Interdistrict desegregation or integration transportation grants. For
interdistrict desegregation or integration transportation grants under Minnesota Statutes,
section 124D.87:

$
13,968,000
.....
2014

$
14,712,000
.....
2015
    Subd. 6. Success for the future. For American Indian success for the future grants
under Minnesota Statutes, section 124D.81:

$
2,137,000
.....
2014

$
2,137,000
.....
2015
The 2014 appropriation includes $290,000 for 2013 and $1,847,000 for 2014.
The 2015 appropriation includes $290,000 for 2014 and $1,847,000 for 2015.
    Subd. 7. American Indian teacher preparation grants. For joint grants to assist
American Indian people to become teachers under Minnesota Statutes, section 122A.63:

$
190,000
.....
2014

$
190,000
.....
2015
    Subd. 8. Tribal contract schools. For tribal contract school aid under Minnesota
Statutes, section 124D.83:

$
2,080,000
.....
2014

$
2,230,000
.....
2015
The 2014 appropriation includes $266,000 for 2013 and $1,814,000 for 2014.
The 2015 appropriation includes $285,000 for 2014 and $1,945,000 for 2015.
    Subd. 9. Early childhood programs at tribal schools. For early childhood family
education programs at tribal contract schools under Minnesota Statutes, section 124D.83,
subdivision 4:

$
68,000
.....
2014

$
68,000
.....
2015
    Subd. 10. Examination fees; teacher training and support programs. (a) For
students' advanced placement and international baccalaureate examination fees under
Minnesota Statutes, section 120B.13, subdivision 3, and the training and related costs
for teachers and other interested educators under Minnesota Statutes, section 120B.13,
subdivision 1:

$
4,500,000
.....
2014

$
4,500,000
.....
2015
(b) The advanced placement program shall receive 75 percent of the appropriation
each year and the international baccalaureate program shall receive 25 percent of the
appropriation each year. The department, in consultation with representatives of the
advanced placement and international baccalaureate programs selected by the Advanced
Placement Advisory Council and the Minnesota Association of IB World Schools,
respectively, shall determine the amounts of the expenditures each year for examination
fees and training and support programs for each program.
(c) Notwithstanding Minnesota Statutes, section 120B.13, subdivision 1, at least
$500,000 each year is for teachers to attend subject matter summer training programs
and follow-up support workshops approved by the advanced placement or international
baccalaureate programs. The amount of the subsidy for each teacher attending an
advanced placement or international baccalaureate summer training program or workshop
shall be the same. The commissioner shall determine the payment process and the amount
of the subsidy.
(d) The commissioner shall pay all examination fees for all students of low-income
families under Minnesota Statutes, section 120B.13, subdivision 3, and to the extent
of available appropriations shall also pay examination fees for students sitting for an
advanced placement examination, international baccalaureate examination, or both.
Any balance in the first year does not cancel but is available in the second year.
    Subd. 11. Concurrent enrollment program. For concurrent enrollment programs
under Minnesota Statutes, section 124D.091:

$
2,000,000
.....
2014

$
2,000,000
.....
2015
If the appropriation is insufficient, the commissioner must proportionately reduce
the aid payment to each district.
Any balance in the first year does not cancel but is available in the second year.
    Subd. 12. Collaborative urban educator. For the collaborative urban educator
grant program:

$
782,000
.....
2014

$
782,000
.....
2015
$195,000 each year is for the Southeast Asian teacher program at Concordia
University, St. Paul; $195,000 each year is for the collaborative educator program at the
University of St. Thomas; $195,000 each year is for the Center for Excellence in Urban
Teaching at Hamline University; and $195,000 each year is for East African teacher
educator activities at Augsburg College.
Any balance in the first year does not cancel but is available in the second year.
Each institution shall prepare for the legislature, by January 15 of each year, a
detailed report regarding the funds used. The report must include the number of teachers
prepared as well as the diversity for each cohort of teachers produced.
    Subd. 13. ServeMinnesota program. For funding ServeMinnesota programs under
Minnesota Statutes, sections 124D.37 to 124D.45:

$
900,000
.....
2014

$
900,000
.....
2015
A grantee organization may provide health and child care coverage to the dependents
of each participant enrolled in a full-time ServeMinnesota program to the extent such
coverage is not otherwise available.
    Subd. 14. Student organizations. For student organizations:

$
725,000
.....
2014

$
725,000
.....
2015
$46,000 each year is for student organizations serving health occupations (HOSA).
$43,000 each year is for student organizations serving service occupations (HERO).
$100,000 each year is for student organizations serving trade and industry
occupations (Skills USA, secondary and postsecondary).
$95,000 each year is for student organizations serving business occupations (BPA,
secondary and postsecondary).
$150,000 each year is for student organizations serving agriculture occupations
(FFA, PAS).
$142,000 each year is for student organizations serving family and consumer science
occupations (FCCLA).
$109,000 each year is for student organizations serving marketing occupations
(DECA and DECA collegiate).
$40,000 each year is for the Minnesota Foundation for Student Organizations.
Any balance in the first year does not cancel but is available in the second year.
    Subd. 15. Early childhood literacy programs. For early childhood literacy
programs under Minnesota Statutes, section 119A.50, subdivision 3:

$
4,125,000
.....
2014

$
4,125,000
.....
2015
Up to $4,125,000 each year is for leveraging federal and private funding to support
AmeriCorps members serving in the Minnesota Reading Corps program established by
ServeMinnesota, including costs associated with the training and teaching of early literacy
skills to children age three to grade 3 and the evaluation of the impact of the program
under Minnesota Statutes, sections 124D.38, subdivision 2, and 124D.42, subdivision 6.
Any balance in the first year does not cancel but is available in the second year.
    Subd. 16. Minnesota math corps program. For the Minnesota math corps program
under Minnesota Statutes, section 124D.42, subdivision 9:

$
250,000
.....
2014

$
250,000
.....
2015
Any unexpended balance in the first year does not cancel but is available in the
second year.
    Subd. 17. Regional centers of excellence. For regional centers of excellence under
Minnesota Statutes, section 120B.115, subdivision 4:

$
1,000,000
.....
2014

$
1,000,000
.....
2015
The base for the regional centers of excellence in fiscal years 2016 and 2017 is
$1,000,000 each year.
    Subd. 18. School Climate Center. For the School Climate Center:

$
500,000
.....
2014

$
500,000
.....
2015
    Subd. 19. Site decision-making grant program. For site decision-making grants
under Minnesota Statutes, section 123B.04, subdivision 2, paragraph (f):

$
200,000
.....
2014
An education site having a written achievement contract under Minnesota Statutes,
section 123B.04, subdivision 4, agreed to by the school board and the education site,
may apply to the commissioner of education for a two-year grant not to exceed $10 per
resident pupil unit at the site in the 2012-2013 school year. Each participating education
site and its school board that are the parties to the achievement contract must report
annually to the commissioner, in the form and manner determined by the commissioner,
on the progress and success of the education site in achieving student or contract goals
or other performance expectations or measures contained in the achievement contract.
The commissioner must include the substance and an analysis of these reports in the
next statewide report under Minnesota Statutes, section 123B.04, subdivision 5, clause
(3), evaluating the effectiveness of site management agreements in redesigning learning
programs and broadening the definition of student achievement. Any unexpended funds
do not cancel but are available in fiscal year 2015.
    Subd. 20. Alternative compensation. For alternative teacher compensation aid
under Minnesota Statutes, section 122A.415, subdivision 4:

$
60,340,000
.....
2015
The 2015 appropriation includes $0 for 2014 and $59,711,000 for 2015.
    Subd. 21. Teacher development and evaluation pilot grant program. For
grants to school districts to participate in the teacher development and evaluation pilot
grant program:

$
683,000
.....
2014
This is a onetime appropriation.
    Subd. 22. Starbase MN. For a grant to Starbase MN for rigorous science,
technology, engineering, and math (STEM) program providing students in grades 4 to
6 with a multisensory learning experience and a hands-on curriculum in an aerospace
environment using state-of-the-art technology:

$
500,000
.....
2014

$
500,000
.....
2015
Any balance in the first year does not cancel and is available in the second year.
    Subd. 23. Civic education grants. For grants to the Minnesota Civic Education
Coalition: Kids Voting St. Paul, Learning Law and Democracy Foundation, and YMCA
Youth in Government to provide civic education programs for Minnesota youth age 18
and under. Civic education is the study of constitutional principles and the democratic
foundation of our national, state, and local institutions and the study of political processes
and structures of government, grounded in the understanding of constitutional government
under the rule of law.

$
125,000
.....
2014

$
125,000
.....
2015
Any balance in the first year does not cancel and is available in the second year.

ARTICLE 4
CHARTER SCHOOLS

    Section 1. Minnesota Statutes 2012, section 124D.10, is amended to read:
124D.10 CHARTER SCHOOLS.
    Subdivision 1. Purposes. (a) The primary purpose of this section is to:
    (1) improve pupil learning and student achievement;. Additional purposes include to:
    (2) (1) increase learning opportunities for pupils;
    (3) (2) encourage the use of different and innovative teaching methods;
    (4) (3) measure learning outcomes and create different and innovative forms of
measuring outcomes;
    (5) (4) establish new forms of accountability for schools; and or
    (6) (5) create new professional opportunities for teachers, including the opportunity
to be responsible for the learning program at the school site.
    (b) This section does not provide a means to keep open a school that a school board
decides to close. However, a school board may endorse or authorize the establishing of
a charter school to replace the school the board decided to close. Applicants seeking a
charter under this circumstance must demonstrate to the authorizer that the charter sought
is substantially different in purpose and program from the school the board closed and
that the proposed charter satisfies the requirements of this subdivision. If the school
board that closed the school authorizes the charter, it must document in its affidavit to the
commissioner that the charter is substantially different in program and purpose from
the school it closed.
    An authorizer shall not approve an application submitted by a charter school
developer under subdivision 4, paragraph (a), if the application does not comply with this
subdivision. The commissioner shall not approve an affidavit submitted by an authorizer
under subdivision 4, paragraph (b), if the affidavit does not comply with this subdivision.
    Subd. 2. Applicability. This section applies only to charter schools formed and
operated under this section.
    Subd. 3. Authorizer. (a) For purposes of this section, the terms defined in this
subdivision have the meanings given them.
    "Application" to receive approval as an authorizer means the proposal an eligible
authorizer submits to the commissioner under paragraph (c) before that authorizer is able
to submit any affidavit to charter to a school.
    "Application" under subdivision 4 means the charter school business plan a
school developer submits to an authorizer for approval to establish a charter school that
documents the school developer's mission statement, school purposes, program design,
financial plan, governance and management structure, and background and experience,
plus any other information the authorizer requests. The application also shall include a
"statement of assurances" of legal compliance prescribed by the commissioner.
    "Affidavit" means a written statement the authorizer submits to the commissioner
for approval to establish a charter school under subdivision 4 attesting to its review and
approval process before chartering a school.
    (b) The following organizations may authorize one or more charter schools:
    (1) a school board, intermediate school district school board, or education district
organized under sections 123A.15 to 123A.19;
    (2) a charitable organization under section 501(c)(3) of the Internal Revenue Code
of 1986, excluding a nonpublic sectarian or religious institution; any person other than a
natural person that directly or indirectly, through one or more intermediaries, controls,
is controlled by, or is under common control with the nonpublic sectarian or religious
institution; and any other charitable organization under this clause that in the federal IRS
Form 1023, Part IV, describes activities indicating a religious purpose, that:
    (i) is a member of the Minnesota Council of Nonprofits or the Minnesota Council on
Foundations;
    (ii) is registered with the attorney general's office; and
    (iii) is incorporated in the state of Minnesota and has been operating continuously
for at least five years but does not operate a charter school;
    (3) a Minnesota private college, notwithstanding clause (2), that grants two- or
four-year degrees and is registered with the Minnesota Office of Higher Education under
chapter 136A; community college, state university, or technical college governed by the
Board of Trustees of the Minnesota State Colleges and Universities; or the University
of Minnesota;
    (4) a nonprofit corporation subject to chapter 317A, described in section 317A.905,
and exempt from federal income tax under section 501(c)(6) of the Internal Revenue Code
of 1986, may authorize one or more charter schools if the charter school has operated
for at least three years under a different authorizer and if the nonprofit corporation has
existed for at least 25 years; or
    (5) single-purpose authorizers that are charitable, nonsectarian organizations formed
under section 501(c)(3) of the Internal Revenue Code of 1986 and incorporated in the
state of Minnesota under chapter 317A as a corporation with no members whose sole
purpose is to charter schools. Eligible organizations interested in being approved as an
authorizer under this paragraph must submit a proposal to the commissioner that includes
the provisions of paragraph (c) and a five-year financial plan. Such authorizers shall
consider and approve charter school applications using the criteria provided in subdivision
4 and shall not limit the applications it solicits, considers, or approves to any single
curriculum, learning program, or method.
    (c) An eligible authorizer under this subdivision must apply to the commissioner for
approval as an authorizer before submitting any affidavit to the commissioner to charter
a school. The application for approval as a charter school authorizer must demonstrate
the applicant's ability to implement the procedures and satisfy the criteria for chartering a
school under this section. The commissioner must approve or disapprove an application
within 45 business days of the application deadline. If the commissioner disapproves
the application, the commissioner must notify the applicant of the specific deficiencies
in writing and the applicant then has 20 business days to address the deficiencies to the
commissioner's satisfaction. After the 20 business days expire, the commissioner has 15
business days to make a final decision to approve or disapprove the application. Failing to
address the deficiencies to the commissioner's satisfaction makes an applicant ineligible to
be an authorizer. The commissioner, in establishing criteria for approval, must consider
the applicant's:
    (1) capacity and infrastructure;
    (2) application criteria and process;
    (3) contracting process;
    (4) ongoing oversight and evaluation processes; and
    (5) renewal criteria and processes.
    (d) An applicant must include in its application to the commissioner to be an
approved authorizer at least the following:
    (1) how chartering schools is a way for the organization to carry out its mission;
    (2) a description of the capacity of the organization to serve as an authorizer,
including the personnel who will perform the authorizing duties, their qualifications, the
amount of time they will be assigned to this responsibility, and the financial resources
allocated by the organization to this responsibility;
    (3) a description of the application and review process the authorizer will use to
make decisions regarding the granting of charters;
    (4) a description of the type of contract it will arrange with the schools it charters
that meets the provisions of subdivision 6;
    (5) the process to be used for providing ongoing oversight of the school consistent
with the contract expectations specified in clause (4) that assures that the schools chartered
are complying with both the provisions of applicable law and rules, and with the contract;
    (6) a description of the criteria and process the authorizer will use to grant expanded
applications under subdivision 4, paragraph (j);
    (7) the process for making decisions regarding the renewal or termination of
the school's charter based on evidence that demonstrates the academic, organizational,
and financial competency of the school, including its success in increasing student
achievement and meeting the goals of the charter school agreement; and
    (8) an assurance specifying that the organization is committed to serving as an
authorizer for the full five-year term.
    (e) A disapproved applicant under this section may resubmit an application during a
future application period.
    (f) If the governing board of an approved authorizer votes to withdraw as an
approved authorizer for a reason unrelated to any cause under subdivision 23, the
authorizer must notify all its chartered schools and the commissioner in writing by July
15 of its intent to withdraw as an authorizer on June 30 in the next calendar year. The
commissioner may approve the transfer of a charter school to a new authorizer under this
paragraph after the new authorizer submits an affidavit to the commissioner.
    (g) The authorizer must participate in department-approved training.
    (h) An authorizer that chartered a school before August 1, 2009, must apply by
June 30, 2012, to the commissioner for approval, under paragraph (c), to continue as an
authorizer under this section. For purposes of this paragraph, an authorizer that fails to
submit a timely application is ineligible to charter a school.
    (i) (h) The commissioner shall review an authorizer's performance every five years
in a manner and form determined by the commissioner and may review an authorizer's
performance more frequently at the commissioner's own initiative or at the request of a
charter school operator, charter school board member, or other interested party. The
commissioner, after completing the review, shall transmit a report with findings to the
authorizer. If, consistent with this section, the commissioner finds that an authorizer has
not fulfilled the requirements of this section, the commissioner may subject the authorizer
to corrective action, which may include terminating the contract with the charter school
board of directors of a school it chartered. The commissioner must notify the authorizer
in writing of any findings that may subject the authorizer to corrective action and
the authorizer then has 15 business days to request an informal hearing before the
commissioner takes corrective action. If the commissioner terminates a contract between
an authorizer and a charter school under this paragraph, the commissioner may assist the
charter school in acquiring a new authorizer.
    (j) (i) The commissioner may at any time take corrective action against an authorizer,
including terminating an authorizer's ability to charter a school for:
    (1) failing to demonstrate the criteria under paragraph (c) under which the
commissioner approved the authorizer;
    (2) violating a term of the chartering contract between the authorizer and the charter
school board of directors;
    (3) unsatisfactory performance as an approved authorizer; or
    (4) any good cause shown that provides the commissioner a legally sufficient reason
to take corrective action against an authorizer.
    Subd. 4. Formation of school. (a) An authorizer, after receiving an application from
a school developer, may charter a licensed teacher under section 122A.18, subdivision
1
, or a group of individuals that includes one or more licensed teachers under section
122A.18, subdivision 1, to operate a school subject to the commissioner's approval of the
authorizer's affidavit under paragraph (b). The school must be organized and operated as a
nonprofit corporation under chapter 317A and the provisions under the applicable chapter
shall apply to the school except as provided in this section.
    Notwithstanding sections 465.717 and 465.719, a school district, subject to this
section and section 124D.11, may create a corporation for the purpose of establishing a
charter school.
    (b) Before the operators may establish and operate a school, the authorizer must file
an affidavit with the commissioner stating its intent to charter a school. An authorizer
must file a separate affidavit for each school it intends to charter. The affidavit must state
the terms and conditions under which the authorizer would charter a school and how the
authorizer intends to oversee the fiscal and student performance of the charter school and to
comply with the terms of the written contract between the authorizer and the charter school
board of directors under subdivision 6. The commissioner must approve or disapprove the
authorizer's affidavit within 60 business days of receipt of the affidavit. If the commissioner
disapproves the affidavit, the commissioner shall notify the authorizer of the deficiencies
in the affidavit and the authorizer then has 20 business days to address the deficiencies.
If the authorizer does not address deficiencies to the commissioner's satisfaction, the
commissioner's disapproval is final. Failure to obtain commissioner approval precludes an
authorizer from chartering the school that is the subject of this affidavit.
    (c) The authorizer may prevent an approved charter school from opening for
operation if, among other grounds, the charter school violates this section or does not meet
the ready-to-open standards that are part of the authorizer's oversight and evaluation
process or are stipulated in the charter school contract.
    (d) The operators authorized to organize and operate a school, before entering into
a contract or other agreement for professional or other services, goods, or facilities,
must incorporate as a nonprofit corporation under chapter 317A and must establish a
board of directors composed of at least five members who are not related parties until a
timely election for members of the ongoing charter school board of directors is held
according to the school's articles and bylaws under paragraph (f). A charter school board
of directors must be composed of at least five members who are not related parties.
Staff members employed at the school, including teachers providing instruction under a
contract with a cooperative, members of the board of directors, and all parents or legal
guardians of children enrolled in the school are the voters eligible to elect the members
of the school's board of directors. A charter school must notify eligible voters of the
school board election dates at least 30 days before the election. Board of director meetings
must comply with chapter 13D.
    (e) A charter school shall publish and maintain on the school's official Web site: (1)
the minutes of meetings of the board of directors, and of members and committees having
any board-delegated authority, for at least one calendar year from the date of publication;
(2) directory information for members of the board of directors and committees having
board-delegated authority; and (3) identifying and contact information for the school's
authorizer. Identifying and contact information for the school's authorizer must be
included in other school materials made available to the public. Upon request of an
individual, the charter school must also make available in a timely fashion financial
statements showing all operations and transactions affecting income, surplus, and deficit
during the school's last annual accounting period; and a balance sheet summarizing assets
and liabilities on the closing date of the accounting period. A charter school also must post
on its official Web site information identifying its authorizer and indicate how to contact
that authorizer and include that same information about its authorizer in other school
materials that it makes available to the public.
    (f) Every charter school board member shall attend ongoing annual training
throughout the member's term on the board governance, including. All new board
members shall attend initial training on the board's role and responsibilities, employment
policies and practices, and financial management. A new board member who does not
begin the required initial training within six months after being seated and complete that
training within 12 months of being seated on the board is automatically ineligible to
continue to serve as a board member. The school shall include in its annual report the
training attended by each board member during the previous year.
    (g) The ongoing board must be elected before the school completes its third year of
operation. Board elections must be held during the school year but may not be conducted
on days when the school is closed for holidays, breaks, or vacations. The charter school
board of directors shall be composed of at least five nonrelated members and include: (i)
at least one licensed teacher employed as a teacher at the school or a licensed teacher
providing instruction under contract between the charter school and a cooperative; (ii) the
at least one parent or legal guardian of a student enrolled in the charter school who is not an
employee of the charter school; and (iii) an at least one interested community member who
resides in Minnesota and is not employed by the charter school and does not have a child
enrolled in the school. The board may be a teacher majority board composed may include
a majority of teachers described in this paragraph or parents or community members, or it
may have no clear majority. The chief financial officer and the chief administrator may only
serve as ex-officio nonvoting board members and may not serve as a voting member of the
board. No charter school employees shall not serve on the board unless other than teachers
under item (i) applies. Contractors providing facilities, goods, or services to a charter
school shall not serve on the board of directors of the charter school. Board bylaws shall
outline the process and procedures for changing the board's governance model structure,
consistent with chapter 317A. A board may change its governance model structure only:
    (1) by a majority vote of the board of directors and a majority vote of the licensed
teachers employed by the school as teachers, including licensed teachers providing
instruction under a contract between the school and a cooperative; and
    (2) with the authorizer's approval.
    Any change in board governance structure must conform with the composition of
the board structure established under this paragraph.
    (h) The granting or renewal of a charter by an authorizer must not be conditioned
upon the bargaining unit status of the employees of the school.
    (i) The granting or renewal of a charter school by an authorizer must not be
contingent on the charter school being required to contract, lease, or purchase services
from the authorizer. Any potential contract, lease, or purchase of service from an
authorizer must be disclosed to the commissioner, accepted through an open bidding
process, and be a separate contract from the charter contract. The school must document
the open bidding process. An authorizer must not enter into a contract to provide
management and financial services for a school that it authorizes, unless the school
documents that it received at least two competitive bids.
    (j) An authorizer may permit the board of directors of a charter school to expand
the operation of the charter school to additional sites or to add additional grades at the
school beyond those described in the authorizer's original affidavit as approved by
the commissioner only after submitting a supplemental affidavit for approval to the
commissioner in a form and manner prescribed by the commissioner. The supplemental
affidavit must document that:
    (1) the proposed expansion plan demonstrates need and projected enrollment;
    (2) the expansion is warranted, at a minimum, by longitudinal data demonstrating
students' improved academic performance and growth on statewide assessments under
chapter 120B;
    (3) the charter school is financially sound and the financing it needs to implement
the proposed expansion exists; and
    (4) the charter school has the governance structure and management capacity to
carry out its expansion.
    (k) The commissioner shall have 30 business days to review and comment on the
supplemental affidavit. The commissioner shall notify the authorizer of any deficiencies in
the supplemental affidavit and the authorizer then has 20 business days to address, to the
commissioner's satisfaction, any deficiencies in the supplemental affidavit. The school
may not expand grades or add sites until the commissioner has approved the supplemental
affidavit. The commissioner's approval or disapproval of a supplemental affidavit is final.
    Subd. 4a. Conflict of interest. (a) An individual is prohibited from serving as a
member of the charter school board of directors if the individual, an immediate family
member, or the individual's partner is an a full or part owner, employee or agent of, or
a contractor principal with a for-profit or nonprofit entity or individual independent
contractor with whom the charter school contracts, directly or indirectly, for professional
services, goods, or facilities. An individual is prohibited from serving as a board member if
an immediate family member is an employee of the school. A violation of this prohibition
renders a contract voidable at the option of the commissioner or the charter school board
of directors. A member of a charter school board of directors who violates this prohibition
is individually liable to the charter school for any damage caused by the violation.
    (b) No member of the board of directors, employee, officer, or agent of a charter
school shall participate in selecting, awarding, or administering a contract if a conflict
of interest exists. A conflict exists when:
    (1) the board member, employee, officer, or agent;
    (2) the immediate family of the board member, employee, officer, or agent;
    (3) the partner of the board member, employee, officer, or agent; or
    (4) an organization that employs, or is about to employ any individual in clauses
(1) to (3),
has a financial or other interest in the entity with which the charter school is contracting.
A violation of this prohibition renders the contract void.
    (c) Any employee, agent, or board member of the authorizer who participates
in the initial review, approval, ongoing oversight, evaluation, or the charter renewal or
nonrenewal process or decision is ineligible to serve on the board of directors of a school
chartered by that authorizer.
    (d) An individual may serve as a member of the board of directors if no conflict of
interest under paragraph (a) exists.
    (e) The conflict of interest provisions under this subdivision do not apply to
compensation paid to a teacher employed as a teacher by the charter school who or a
teacher who provides instructional services to the charter school through a cooperative
formed under chapter 308A when the teacher also serves as a member of on the charter
school board of directors.
    (f) The conflict of interest provisions under this subdivision do not apply to a teacher
who provides services to a charter school through a cooperative formed under chapter
308A when the teacher also serves on the charter school board of directors.
    Subd. 5. Conversion of existing schools. A board of an independent or special
school district may convert one or more of its existing schools to charter schools under
this section if 60 percent of the full-time teachers at the school sign a petition seeking
conversion. The conversion must occur at the beginning of an academic year.
    Subd. 6. Charter contract. The authorization for a charter school must be in the
form of a written contract signed by the authorizer and the board of directors of the charter
school. The contract must be completed within 45 business days of the commissioner's
approval of the authorizer's affidavit. The authorizer shall submit to the commissioner a
copy of the signed charter contract within ten business days of its execution. The contract
for a charter school must be in writing and contain at least the following:
(1) a declaration that the charter school will carry out the primary purpose in
subdivision 1 and how the school will report its implementation of the primary purpose;
    (1) (2) a declaration of the additional purpose or purposes in subdivision 1 that the
school intends to carry out and how the school will report its implementation of those
purposes;
    (2) (3) a description of the school program and the specific academic and
nonacademic outcomes that pupils must achieve;
    (3) (4) a statement of admission policies and procedures;
    (4) (5) a governance, management, and administration plan for the school;
    (5) (6) signed agreements from charter school board members to comply with all
federal and state laws governing organizational, programmatic, and financial requirements
applicable to charter schools;
    (6) (7) the criteria, processes, and procedures that the authorizer will use for
ongoing oversight of operational, financial, and academic performance to monitor and
evaluate the fiscal, operational, and academic performance consistent with subdivision
15, paragraphs (a) and (b);
    (7) (8) for contract renewal, the formal written performance evaluation of the school
that is a prerequisite for reviewing a charter contract under subdivision 15;
    (8) (9) types and amounts of insurance liability coverage to be obtained by the
charter school, consistent with subdivision 8, paragraph (k);
    (9) (10) consistent with subdivision 25, paragraph (d), a provision to indemnify and
hold harmless the authorizer and its officers, agents, and employees from any suit, claim,
or liability arising from any operation of the charter school, and the commissioner and
department officers, agents, and employees notwithstanding section 3.736;
    (10) (11) the term of the initial contract, which may be up to five years plus an
additional preoperational planning year, and up to five years for a renewed contract or a
contract with a new authorizer after a transfer of authorizers, if warranted by the school's
academic, financial, and operational performance;
    (11) (12) how the board of directors or the operators of the charter school will
provide special instruction and services for children with a disability under sections
125A.03 to 125A.24, and 125A.65, a description of the financial parameters within
which the charter school will operate to provide the special instruction and services to
children with a disability;
    (12) the process and criteria the authorizer intends to use to monitor and evaluate the
fiscal and student performance of the charter school, consistent with subdivision 15; and
(13) the specific conditions for contract renewal that identify performance under the
primary purpose of subdivision 1 as the most important factor in determining contract
renewal;
(14) the additional purposes under subdivision 1, paragraph (a), and related
performance obligations under clause (7) contained in the charter contract as additional
factors in determining contract renewal; and
    (13) (15) the plan for an orderly closing of the school under chapter 317A, if whether
the closure is a termination for cause, a voluntary termination, or a nonrenewal of the
contract, and that includes establishing the responsibilities of the school board of directors
and the authorizer and notifying the commissioner, authorizer, school district in which the
charter school is located, and parents of enrolled students about the closure, information
and assistance sufficient to enable the student to re-enroll in another school, the transfer
of student records to students' resident districts under subdivision 8, paragraph (p), and
procedures for closing financial operations.
    Subd. 6a. Audit report. (a) The charter school must submit an audit report to the
commissioner and its authorizer by December 31 each year.
    (b) The charter school, with the assistance of the auditor conducting the audit,
must include with the report, as supplemental information, a copy of all charter school
agreements for corporate management services, including parent company or other
administrative, financial, and staffing services. If the entity that provides the professional
services to the charter school is exempt from taxation under section 501 of the Internal
Revenue Code of 1986, that entity must file with the commissioner by February 15 a copy
of the annual return required under section 6033 of the Internal Revenue Code of 1986.
    (c) A charter school independent audit report shall include audited financial data of
an affiliated building corporation or other component unit.
    (c) (d) If the audit report finds that a material weakness exists in the financial
reporting systems of a charter school, the charter school must submit a written report to
the commissioner explaining how the material weakness will be resolved. An auditor,
as a condition of providing financial services to a charter school, must agree to make
available information about a charter school's financial audit to the commissioner and
authorizer upon request.
    Subd. 7. Public status; exemption from statutes and rules. A charter school is
a public school and is part of the state's system of public education. A charter school is
exempt from all statutes and rules applicable to a school, school board, or school district
unless a statute or rule is made specifically applicable to a charter school or is included
in this section.
    Subd. 8. Federal, state, and local requirements. (a) A charter school shall meet all
federal, state, and local health and safety requirements applicable to school districts.
    (b) A school must comply with statewide accountability requirements governing
standards and assessments in chapter 120B.
    (c) A school authorized by a school board may be located in any district, unless the
school board of the district of the proposed location disapproves by written resolution.
    (d) A charter school must be nonsectarian in its programs, admission policies,
employment practices, and all other operations. An authorizer may not authorize a charter
school or program that is affiliated with a nonpublic sectarian school or a religious
institution. A charter school student must be released for religious instruction, consistent
with section 120A.22, subdivision 12, clause (3).
    (e) Charter schools must not be used as a method of providing education or
generating revenue for students who are being home-schooled. This paragraph does not
apply to shared time aid under section 126C.19.
    (f) The primary focus of a charter school must be to provide a comprehensive
program of instruction for at least one grade or age group from five through 18 years
of age. Instruction may be provided to people younger than five years and older than
18 years of age.
    (g) A charter school may not charge tuition.
    (h) A charter school is subject to and must comply with chapter 363A and section
121A.04.
    (i) A charter school is subject to and must comply with the Pupil Fair Dismissal
Act, sections 121A.40 to 121A.56, and the Minnesota Public School Fee Law, sections
123B.34 to 123B.39.
    (j) A charter school is subject to the same financial audits, audit procedures, and
audit requirements as a district, except as required under subdivision 6a. Audits must be
conducted in compliance with generally accepted governmental auditing standards, the
federal Single Audit Act, if applicable, and section 6.65. A charter school is subject
to and must comply with sections 15.054; 118A.01; 118A.02; 118A.03; 118A.04;
118A.05; 118A.06; 471.38; 471.391; 471.392; and 471.425. The audit must comply with
the requirements of sections 123B.75 to 123B.83, except to the extent deviations are
necessary because of the program at the school. Deviations must be approved by the
commissioner and authorizer. The Department of Education, state auditor, legislative
auditor, or authorizer may conduct financial, program, or compliance audits. A charter
school determined to be in statutory operating debt under sections 123B.81 to 123B.83
must submit a plan under section 123B.81, subdivision 4.
    (k) A charter school is a district for the purposes of tort liability under chapter 466.
    (l) A charter school must comply with chapters 13 and 13D; and sections 120A.22,
subdivision 7
; 121A.75; and 260B.171, subdivisions 3 and 5.
    (m) A charter school is subject to the Pledge of Allegiance requirement under
section 121A.11, subdivision 3.
    (n) A charter school offering online courses or programs must comply with section
124D.095.
    (o) A charter school and charter school board of directors are subject to chapter 181.
    (p) A charter school must comply with section 120A.22, subdivision 7, governing
the transfer of students' educational records and sections 138.163 and 138.17 governing
the management of local records.
    (q) A charter school that provides early childhood health and developmental
screening must comply with sections 121A.16 to 121A.19.
    (r) A charter school that provides school-sponsored youth athletic activities must
comply with section 121A.38.
    (s) A charter school is subject to and must comply with continuing truant notification
under section 260A.03.
(t) A charter school must develop and implement a teacher evaluation and peer
review process, under section 122A.40, subdivision 8, paragraph (b), clauses (2) to (12).
(u) A charter school most adopt a policy, plan, budget, and process, consistent with
section 120B.11, to review curriculum, instruction, and student achievement and strive
for the world's best workforce.
    Subd. 8a. Aid reduction. The commissioner may reduce a charter school's state aid
under section 127A.42 or 127A.43 if the charter school board fails to correct a violation
under this section.
    Subd. 8b. Aid reduction for violations. The commissioner may reduce a charter
school's state aid by an amount not to exceed 60 percent of the charter school's basic
revenue for the period of time that a violation of law occurs.
    Subd. 9. Admission requirements. (a) A charter school may limit admission to:
    (1) pupils within an age group or grade level;
    (2) pupils who are eligible to participate in the graduation incentives program under
section 124D.68; or
    (3) residents of a specific geographic area in which the school is located when the
majority of students served by the school are members of underserved populations.
    (b) A charter school shall enroll an eligible pupil who submits a timely application,
unless the number of applications exceeds the capacity of a program, class, grade level, or
building. In this case, pupils must be accepted by lot. The charter school must develop
and publish, including on its Web site, a lottery policy and process that it must use when
accepting pupils by lot.
    (c) A charter school shall give enrollment preference to a sibling of an enrolled pupil
and to a foster child of that pupil's parents and may give preference for enrolling children
of the school's staff before accepting other pupils by lot.
    (d) A person shall not be admitted to a charter school (1) as a kindergarten pupil,
unless the pupil is at least five years of age on September 1 of the calendar year in which
the school year for which the pupil seeks admission commences; or (2) as a first grade
student, unless the pupil is at least six years of age on September 1 of the calendar year in
which the school year for which the pupil seeks admission commences or has completed
kindergarten; except that a charter school may establish and publish on its Web site a
policy for admission of selected pupils at an earlier age, consistent with the enrollment
process in paragraphs (b) and (c).
    (e) Except as permitted in paragraph (d), a charter school may not limit admission
to pupils on the basis of intellectual ability, measures of achievement or aptitude, or
athletic ability and may not establish any criteria or requirements for admission that are
inconsistent with this subdivision.
    (f) The charter school shall not distribute any services or goods of value to students,
parents, or guardians as an inducement, term, or condition of enrolling a student in a
charter school.
    Subd. 10. Pupil performance. A charter school must design its programs to at
least meet the outcomes adopted by the commissioner for public school students. In
the absence of the commissioner's requirements, the school must meet the outcomes
contained in the contract with the authorizer. The achievement levels of the outcomes
contained in the contract may exceed the achievement levels of any outcomes adopted by
the commissioner for public school students.
    Subd. 11. Employment and other operating matters. (a) A charter school must
employ or contract with necessary teachers, as defined by section 122A.15, subdivision 1,
who hold valid licenses to perform the particular service for which they are employed in
the school. The charter school's state aid may be reduced under section 127A.43 if the
school employs a teacher who is not appropriately licensed or approved by the board of
teaching. The school may employ necessary employees who are not required to hold
teaching licenses to perform duties other than teaching and may contract for other services.
The school may discharge teachers and nonlicensed employees. The charter school board
is subject to section 181.932. When offering employment to a prospective employee, a
charter school must give that employee a written description of the terms and conditions
of employment and the school's personnel policies.
    (b) A person, without holding a valid administrator's license, may perform
administrative, supervisory, or instructional leadership duties. The board of directors shall
establish qualifications for persons that hold administrative, supervisory, or instructional
leadership roles. The qualifications shall include at least the following areas: instruction
and assessment; human resource and personnel management; financial management;
legal and compliance management; effective communication; and board, authorizer, and
community relationships. The board of directors shall use those qualifications as the basis
for job descriptions, hiring, and performance evaluations of those who hold administrative,
supervisory, or instructional leadership roles. The board of directors and an individual
who does not hold a valid administrative license and who serves in an administrative,
supervisory, or instructional leadership position shall develop a professional development
plan. Documentation of the implementation of the professional development plan of these
persons shall be included in the school's annual report.
    (c) The board of directors also shall decide and be responsible for policy matters
related to the operation of the school, including budgeting, curriculum programming,
personnel, and operating procedures. The board shall adopt a policy on nepotism in
employment. The board shall adopt personnel evaluation policies and practices that,
at a minimum:
(1) carry out the school's mission and goals;
(2) evaluate the execution of charter contract goals and commitments;
(3) evaluate student achievement, postsecondary and workforce readiness, and
student engagement and connection goals;
(4) establish a teacher evaluation process under subdivision 8, paragraph (t); and
(5) provide professional development related to the individual's job responsibilities.
    Subd. 12. Pupils with a disability. A charter school must comply with sections
125A.02, 125A.03 to 125A.24, and 125A.65 and rules relating to the education of pupils
with a disability as though it were a district.
    Subd. 13. Length of school year. A charter school must provide instruction each
year for at least the number of hours required by section 120A.41. It may provide
instruction throughout the year according to sections 124D.12 to 124D.127 or 124D.128.
    Subd. 14. Annual public reports. (a) A charter school must publish an annual report
approved by the board of directors. The annual report must at least include information
on school enrollment, student attrition, governance and management, staffing, finances,
academic performance, operational performance, innovative practices and implementation,
and future plans. A charter school must post the annual report on the school's official
Web site. A charter school must also distribute the annual report by publication, mail, or
electronic means to the commissioner, its authorizer, school employees, and parents and
legal guardians of students enrolled in the charter school and must also post the report on
the charter school's official Web site. The reports are public data under chapter 13.
    (b) The commissioner shall establish specifications for an authorizer's annual public
report that is part of the system to evaluate authorizer performance under subdivision
3, paragraph (h). The report shall at least include key indicators of school academic,
operational, and financial performance.
    Subd. 15. Review and comment. (a) The authorizer shall provide a formal written
evaluation of the school's performance before the authorizer renews the charter contract.
The department must review and comment on the authorizer's evaluation process at the
time the authorizer submits its application for approval and each time the authorizer
undergoes its five-year review under subdivision 3, paragraph (i) (h).
    (b) An authorizer shall monitor and evaluate the fiscal, academic, financial,
operational, and student performance of the school, and may for this purpose annually
assess a charter school a fee according to paragraph (c). The agreed-upon fee structure
must be stated in the charter school contract.
    (c) The fee that each charter school pays to an authorizer each year an authorizer
may annually assess is the greater of:
    (1) the basic formula allowance for that year; or
    (2) the lesser of:
    (i) the maximum fee factor times the basic formula allowance for that year; or
    (ii) the fee factor times the basic formula allowance for that year times the charter
school's adjusted marginal cost pupil units for that year. The fee factor equals .005 in fiscal
year 2010, .01 in fiscal year 2011, .013 in fiscal year 2012, and .015 in fiscal years 2013
and later. The maximum fee factor equals 1.5 in fiscal year 2010, 2.0 in fiscal year 2011,
3.0 in fiscal year 2012, and 4.0 in fiscal years 2013 and later.
    (d) An authorizer may not assess a fee for any required services other than as
provided in this subdivision.
    (e) For the preoperational planning period, after a school is chartered, the authorizer
may assess a charter school a fee equal to the basic formula allowance.
    (f) By September 30 of each year, an authorizer shall submit to the commissioner a
statement of income and expenditures related to chartering activities during the previous
school year ending June 30. A copy of the statement shall be given to all schools chartered
by the authorizer.
    Subd. 16. Transportation. (a) A charter school after its first fiscal year of operation
by March 1 of each fiscal year and a charter school by July 1 of its first fiscal year of
operation must notify the district in which the school is located and the Department of
Education if it will provide its own transportation or use the transportation services of the
district in which it is located for the fiscal year.
    (b) If a charter school elects to provide transportation for pupils, the transportation
must be provided by the charter school within the district in which the charter school is
located. The state must pay transportation aid to the charter school according to section
124D.11, subdivision 2.
    For pupils who reside outside the district in which the charter school is located, the
charter school is not required to provide or pay for transportation between the pupil's
residence and the border of the district in which the charter school is located. A parent
may be reimbursed by the charter school for costs of transportation from the pupil's
residence to the border of the district in which the charter school is located if the pupil is
from a family whose income is at or below the poverty level, as determined by the federal
government. The reimbursement may not exceed the pupil's actual cost of transportation
or 15 cents per mile traveled, whichever is less. Reimbursement may not be paid for
more than 250 miles per week.
    At the time a pupil enrolls in a charter school, the charter school must provide the
parent or guardian with information regarding the transportation.
    (c) If a charter school does not elect to provide transportation, transportation for
pupils enrolled at the school must be provided by the district in which the school is
located, according to sections 123B.88, subdivision 6, and 124D.03, subdivision 8, for a
pupil residing in the same district in which the charter school is located. Transportation
may be provided by the district in which the school is located, according to sections
123B.88, subdivision 6, and 124D.03, subdivision 8, for a pupil residing in a different
district. If the district provides the transportation, the scheduling of routes, manner and
method of transportation, control and discipline of the pupils, and any other matter relating
to the transportation of pupils under this paragraph shall be within the sole discretion,
control, and management of the district.
    Subd. 17. Leased space. A charter school may lease space from an independent
or special school board eligible to be an authorizer, other public organization, private,
nonprofit nonsectarian organization, private property owner, or a sectarian organization
if the leased space is constructed as a school facility. The department must review and
approve or disapprove leases in a timely manner for purposes of determining eligibility for
lease aid under section 124D.11, subdivision 4.
    Subd. 17a. Affiliated nonprofit building corporation. (a) Before a charter school
may organize an affiliated nonprofit building corporation (i) to renovate or purchase an
existing facility to serve as a school or (ii) to expand an existing building or construct
a new school facility, an authorizer must submit an affidavit to the commissioner for
approval in the form and manner the commissioner prescribes, and consistent with
paragraphs (b) and (c) or (d).
    (b) An affiliated nonprofit building corporation under this subdivision must:
    (1) be incorporated under section 317A;
    (2) comply with applicable Internal Revenue Service regulations, including
regulations for "supporting organizations" as defined by the Internal Revenue Service;
    (3) submit to the commissioner each fiscal year a list of current board members
and a copy of its annual audit; and
    (4) comply with government data practices law under chapter 13.
An affiliated nonprofit building corporation must not serve as the leasing agent for
property or facilities it does not own. A charter school that leases a facility from an
affiliated nonprofit building corporation that does not own the leased facility is ineligible
to receive charter school lease aid. The state is immune from liability resulting from a
contract between a charter school and an affiliated nonprofit building corporation.
    (c) A charter school may organize an affiliated nonprofit building corporation to
renovate or purchase an existing facility to serve as a school if the charter school:
    (1) has been operating for at least five consecutive school years;
    (2) has had a net positive unreserved general fund balance as of June 30 in the
preceding five fiscal years;
    (3) has a long-range strategic and financial plan;
    (4) completes a feasibility study of available buildings;
    (5) documents enrollment projections and the need to use an affiliated building
corporation to renovate or purchase an existing facility to serve as a school; and
(6) has a plan for the renovation or purchase, which describes the parameters and
budget for the project.
    (d) A charter school may organize an affiliated nonprofit building corporation to
expand an existing school facility or construct a new school facility if the charter school:
    (1) demonstrates the lack of facilities available to serve as a school;
    (2) has been operating for at least eight consecutive school years;
    (3) has had a net positive unreserved general fund balance as of June 30 in the
preceding five fiscal years;
    (4) completes a feasibility study of facility options;
    (5) has a long-range strategic and financial plan that includes enrollment projections
and demonstrates the need for constructing a new school facility; and
    (6) has a plan for the expansion or new school facility, which describes the
parameters and budget for the project.
    Subd. 17b. Positive review and comment. (e) A charter school or an affiliated
nonprofit building corporation organized by a charter school must not initiate an
installment contract for purchase, or a lease agreement, or solicit bids for new construction,
expansion, or remodeling of an educational facility that requires an expenditure in
excess of $1,400,000, unless it meets the criteria in subdivision 17a, paragraph (b) and
paragraph (c) or (d), as applicable, and receives a positive review and comment from
the commissioner under section 123B.71.
    Subd. 19. Disseminate information. (a) The authorizer, the operators, Authorizers
and the department must disseminate information to the public on how to form and
operate a charter school. Charter schools must disseminate information about how to
use the offerings of a charter school. Targeted groups include low-income families and
communities, students of color, and students who are at risk of academic failure.
    (b) Authorizers, operators, and the department also may disseminate information
about the successful best practices in teaching and learning demonstrated by charter
schools.
    Subd. 20. Leave to teach in a charter school. If a teacher employed by a district
makes a written request for an extended leave of absence to teach at a charter school,
the district must grant the leave. The district must grant a leave not to exceed a total of
five years. Any request to extend the leave shall be granted only at the discretion of the
school board. The district may require that the request for a leave or extension of leave
be made before February 1 in the school year preceding the school year in which the
teacher intends to leave, or February 1 of the calendar year in which the teacher's leave is
scheduled to terminate. Except as otherwise provided in this subdivision and except for
section 122A.46, subdivision 7, the leave is governed by section 122A.46, including, but
not limited to, reinstatement, notice of intention to return, seniority, salary, and insurance.
    During a leave, the teacher may continue to aggregate benefits and credits in the
Teachers' Retirement Association account under chapters 354 and 354A, consistent with
subdivision 22.
    Subd. 21. Collective bargaining. Employees of the board of directors of a charter
school may, if otherwise eligible, organize under chapter 179A and comply with its
provisions. The board of directors of a charter school is a public employer, for the
purposes of chapter 179A, upon formation of one or more bargaining units at the school.
Bargaining units at the school must be separate from any other units within an authorizing
district, except that bargaining units may remain part of the appropriate unit within an
authorizing district, if the employees of the school, the board of directors of the school,
the exclusive representative of the appropriate unit in the authorizing district, and the
board of the authorizing district agree to include the employees in the appropriate unit of
the authorizing district.
    Subd. 22. Teacher and other employee retirement. (a) Teachers in a charter
school must be public school teachers for the purposes of chapters 354 and 354A.
    (b) Except for teachers under paragraph (a), employees in a charter school must be
public employees for the purposes of chapter 353.
    Subd. 23. Causes for nonrenewal or termination of charter school contract. (a)
The duration of the contract with an authorizer must be for the term contained in the
contract according to subdivision 6. The authorizer may or may not renew a contract at
the end of the term for any ground listed in paragraph (b). An authorizer may unilaterally
terminate a contract during the term of the contract for any ground listed in paragraph (b).
At least 60 business days before not renewing or terminating a contract, the authorizer
shall notify the board of directors of the charter school of the proposed action in writing.
The notice shall state the grounds for the proposed action in reasonable detail and that the
charter school's board of directors may request in writing an informal hearing before the
authorizer within 15 business days of receiving notice of nonrenewal or termination of
the contract. Failure by the board of directors to make a written request for an informal
hearing within the 15-business-day period shall be treated as acquiescence to the proposed
action. Upon receiving a timely written request for a hearing, the authorizer shall give ten
business days' notice to the charter school's board of directors of the hearing date. The
authorizer shall conduct an informal hearing before taking final action. The authorizer
shall take final action to renew or not renew a contract no later than 20 business days
before the proposed date for terminating the contract or the end date of the contract.
    (b) A contract may be terminated or not renewed upon any of the following grounds:
    (1) failure to meet demonstrate satisfactory academic achievement for all students,
including the requirements for pupil performance contained in the contract;
    (2) failure to meet generally accepted standards of fiscal management;
    (3) violations of law; or
    (4) other good cause shown.
    If a contract is terminated or not renewed under this paragraph, the school must be
dissolved according to the applicable provisions of chapter 317A.
    (c) If the authorizer and the charter school board of directors mutually agree to
terminate or not renew the contract, a change in authorizers is allowed if the commissioner
approves the change to a different eligible authorizer to authorize the charter school.
Both parties must jointly submit their intent in writing to the commissioner to mutually
terminate the contract. The authorizer that is a party to the existing contract must inform
the proposed authorizer about the fiscal and operational status and student performance
of the school. Before the commissioner determines whether to approve a change in
authorizer, the proposed authorizer must identify any outstanding issues in the proposed
charter contract that were unresolved in the previous charter contract and have the charter
school agree to resolve those issues. If no change in authorizer is approved, the school
must be dissolved according to applicable law and the terms of the contract.
    (c) If the authorizer and the charter school board of directors mutually agree not to
renew the contract, a change in authorizers is allowed. The authorizer and the school
board must jointly submit a written and signed letter of their intent to the commissioner
to mutually not renew the contract. The authorizer that is a party to the existing contract
must inform the proposed authorizer about the fiscal, operational, and student performance
status of the school, as well as any outstanding contractual obligations that exist. The
charter contract between the proposed authorizer and the school must identify and provide
a plan to address any outstanding obligations from the previous contract. The proposed
contract must be submitted at least 105 business days before the end of the existing
charter contract. The commissioner shall have 30 business days to review and make a
determination. The proposed authorizer and the school shall have 15 business days to
respond to the determination and address any issues identified by the commissioner. A
final determination by the commissioner shall be made no later than 45 business days
before the end of the current charter contract. If no change in authorizer is approved, the
school and the current authorizer may withdraw their letter of nonrenewal and enter into a
new contract. If the transfer of authorizers is not approved and the current authorizer and
the school do not withdraw their letter and enter into a new contract, the school must be
dissolved according to applicable law and the terms of the contract.
    (d) The commissioner, after providing reasonable notice to the board of directors of
a charter school and the existing authorizer, and after providing an opportunity for a public
hearing, may terminate the existing contract between the authorizer and the charter school
board if the charter school has a history of:
    (1) failure to meet pupil performance requirements consistent with state law;
    (2) financial mismanagement or failure to meet generally accepted standards of
fiscal management; or
    (3) repeated or major violations of the law.
    Subd. 23a. Related party lease costs. (a) A charter school is prohibited from
entering a lease of real property with a related party unless the lessor is a nonprofit
corporation under chapter 317A or a cooperative under chapter 308A, and the lease cost is
reasonable under section 124D.11, subdivision 4, clause (1).
    (b) For purposes of this section and section 124D.11:
    (1) "related party" means an affiliate or immediate relative of the other party in
question, an affiliate of an immediate relative, or an immediate relative of an affiliate;
    (2) "affiliate" means a person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with another person;
    (3) "immediate family" means an individual whose relationship by blood, marriage,
adoption, or partnering is no more remote than first cousin;
    (4) "person" means an individual or entity of any kind; and
    (5) "control" means the ability to affect the management, operations, or policy
actions or decisions of a person, whether through ownership of voting securities, by
contract, or otherwise.
    (c) A lease of real property to be used for a charter school, not excluded in paragraph
(a), must contain the following statement: "This lease is subject to Minnesota Statutes,
section 124D.10, subdivision 23a."
    (d) If a charter school enters into as lessee a lease with a related party and the
charter school subsequently closes, the commissioner has the right to recover from the
lessor any lease payments in excess of those that are reasonable under section 124D.11,
subdivision 4
, clause (1).
    Subd. 24. Pupil enrollment upon nonrenewal or termination of charter school
contract. If a contract is not renewed or is terminated according to subdivision 23, a
pupil who attended the school, siblings of the pupil, or another pupil who resides in the
same place as the pupil may enroll in the resident district or may submit an application
to a nonresident district according to section 124D.03 at any time. Applications and
notices required by section 124D.03 must be processed and provided in a prompt manner.
The application and notice deadlines in section 124D.03 do not apply under these
circumstances. The closed charter school must transfer the student's educational records
within ten business days of closure to the student's school district of residence where the
records must be retained or transferred under section 120A.22, subdivision 7.
    Subd. 25. Extent of specific legal authority. (a) The board of directors of a charter
school may sue and be sued.
    (b) The board may not levy taxes or issue bonds.
    (c) The commissioner, an authorizer, members of the board of an authorizer in
their official capacity, and employees of an authorizer are immune from civil or criminal
liability with respect to all activities related to a charter school they approve or authorize.
The board of directors shall obtain at least the amount of and types of insurance up to the
applicable tort liability limits under chapter 466. The charter school board must submit
a copy of the insurance policy to its authorizer and the commissioner before starting
operations. The charter school board must submit changes in its insurance carrier or policy
to its authorizer and the commissioner within 20 business days of the change.
(d) Notwithstanding section 3.736, the charter school shall assume full liability for
its activities and indemnify and hold harmless the authorizer and its officers, agents, and
employees from any suit, claim, or liability arising from any operation of the charter school
and the commissioner and department officers, agents, and employees. A charter school
is not required to indemnify or hold harmless a state employee if the state would not be
required to indemnify and hold the employee harmless under section 3.736, subdivision 9.
    Subd. 27. Collaboration between charter school and school district. (a) A charter
school board may voluntarily enter into a two-year, renewable agreement for collaboration
to enhance student achievement with a school district within whose geographic boundary
it operates.
(b) A school district need not be an approved authorizer to enter into a collaboration
agreement with a charter school. A charter school need not be authorized by the school
district with which it seeks to collaborate.
(c) A charter school authorizer is prohibited from requiring a collaboration agreement
as a condition of entering into or renewing a charter contract as defined in subdivision 6.
(d) Nothing in this subdivision or in the collaboration agreement may impact in any
way the authority or autonomy of the charter school.
(e) Nothing in this subdivision or in the collaboration agreement shall cause the state
to pay twice for the same student, service, or facility or otherwise impact state funding, or
the flow thereof, to the school district or the charter school.
(f) The collaboration agreement may include, but need not be limited to,
collaboration regarding facilities, transportation, training, student achievement,
assessments, mutual performance standards, and other areas of mutual agreement.
(g) The school district may include the academic performance of the students of a
collaborative charter school site operating within the geographic boundaries of the school
district, for purposes of student assessment and reporting to the state.
(h) Districts, authorizers, or charter schools entering into a collaborative agreement
are equally and collectively subject to the same state and federal accountability measures
for student achievement, school performance outcomes, and school improvement
strategies. The collaborative agreement and all accountability measures must be posted
on the district, charter school, and authorizer Web sites.
EFFECTIVE DATE.This section is effective July 1, 2013, except subdivision 6 is
effective August 1, 2013.

    Sec. 2. Minnesota Statutes 2012, section 124D.11, subdivision 1, is amended to read:
    Subdivision 1. General education revenue. (a) General education revenue must
be paid to a charter school as though it were a district. The general education revenue
for each adjusted marginal cost pupil unit is the state average general education revenue
per pupil unit, plus the referendum equalization aid allowance in the pupil's district of
residence, minus an amount equal to the product of the formula allowance according to
section 126C.10, subdivision 2, times .0485 .0466, calculated without basic skills revenue,
extended time revenue, alternative teacher compensation revenue, pension adjustment
revenue, transition revenue, and transportation sparsity revenue, plus basic skills revenue,
extended time revenue, basic alternative teacher compensation aid according to section
126C.10, subdivision 34, pension adjustment revenue, and transition revenue as though
the school were a school district. The general education revenue for each extended time
marginal cost pupil unit equals $4,378 $4,794.
(b) Notwithstanding paragraph (a), for charter schools in the first year of operation,
general education revenue shall be computed using the number of adjusted pupil units
in the current fiscal year.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 3. Minnesota Statutes 2012, section 124D.11, subdivision 2, is amended to read:
    Subd. 2. Transportation revenue. Transportation revenue must be paid to a charter
school that provides transportation services according to section 124D.10, subdivision 16,
according to this subdivision. Transportation aid shall equal transportation revenue.
In addition to the revenue under subdivision 1, a charter school providing
transportation services must receive general education aid equal to the sum of the product
of (i) an amount equal to the product of the formula allowance according to section
126C.10, subdivision 2, times .0485 .0466, plus the transportation sparsity allowance for
the school district in which the charter school is located times (ii) the adjusted marginal
cost pupil units, plus the product of $223 times the extended time marginal cost pupil units.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 4. Minnesota Statutes 2012, section 124D.11, subdivision 4, is amended to read:
    Subd. 4. Building lease aid. (a) When a charter school finds it economically
advantageous to rent or lease a building or land for any instructional purposes and it
determines that the total operating capital revenue under section 126C.10, subdivision 13,
is insufficient for this purpose, it may apply to the commissioner for building lease aid
for this purpose. The commissioner must review and either approve or deny a lease aid
application using the following criteria:
(1) the reasonableness of the price based on current market values;
(2) the extent to which the lease conforms to applicable state laws and rules; and
(3) the appropriateness of the proposed lease in the context of the space needs and
financial circumstances of the charter school. The commissioner must approve aid only
for a facility lease that has (i) a sum certain annual cost and (ii) an escape clause the
charter school may exercise if its charter contract is terminated or not renewed.
A charter school must not use the building lease aid it receives for custodial, maintenance
service, utility, or other operating costs.
    (b) The amount of annual building lease aid per pupil unit served for a charter school
for any year shall not exceed the lesser of (a) (1) 90 percent of the approved cost or (b) (2)
the product of the pupil units served for the current school year times $1,200 $1,314.
EFFECTIVE DATE.This section is effective July 1, 2014.

    Sec. 5. Minnesota Statutes 2012, section 260A.02, subdivision 3, is amended to read:
    Subd. 3. Continuing truant. "Continuing truant" means a child who is subject to the
compulsory instruction requirements of section 120A.22 and is absent from instruction in a
school, as defined in section 120A.05, without valid excuse within a single school year for:
(1) three days if the child is in elementary school; or
(2) three or more class periods on three days if the child is in middle school, junior
high school, or high school.
Nothing in this section shall prevent a school district or charter school from notifying
a truant child's parent or legal guardian of the child's truancy or otherwise addressing a
child's attendance problems prior to the child becoming a continuing truant.

    Sec. 6. Minnesota Statutes 2012, section 260A.03, is amended to read:
260A.03 NOTICE TO PARENT OR GUARDIAN WHEN CHILD IS A
CONTINUING TRUANT.
Upon a child's initial classification as a continuing truant, the school attendance
officer or other designated school official shall notify the child's parent or legal guardian,
by first-class mail or other reasonable means, of the following:
(1) that the child is truant;
(2) that the parent or guardian should notify the school if there is a valid excuse
for the child's absences;
(3) that the parent or guardian is obligated to compel the attendance of the child
at school pursuant to section 120A.22 and parents or guardians who fail to meet this
obligation may be subject to prosecution under section 120A.34;
(4) that this notification serves as the notification required by section 120A.34;
(5) that alternative educational programs and services may be available in the child's
enrolling or resident district;
(6) that the parent or guardian has the right to meet with appropriate school personnel
to discuss solutions to the child's truancy;
(7) that if the child continues to be truant, the parent and child may be subject to
juvenile court proceedings under chapter 260C;
(8) that if the child is subject to juvenile court proceedings, the child may be subject
to suspension, restriction, or delay of the child's driving privilege pursuant to section
260C.201; and
(9) that it is recommended that the parent or guardian accompany the child to school
and attend classes with the child for one day.

    Sec. 7. Minnesota Statutes 2012, section 260A.05, subdivision 1, is amended to read:
    Subdivision 1. Establishment. A school district or charter school may establish
one or more school attendance review boards to exercise the powers and duties in this
section. The school district or charter school board shall appoint the members of the
school attendance review board and designate the schools within the board's jurisdiction.
Members of a school attendance review board may include:
(1) the superintendent of the school district or the superintendent's designee or
charter school director or the director's designee;
(2) a principal and one or more other school officials from within the district or
charter school;
(3) parent representatives;
(4) representatives from community agencies that provide services for truant
students and their families;
(5) a juvenile probation officer;
(6) school counselors and attendance officers; and
(7) law enforcement officers.

    Sec. 8. Minnesota Statutes 2012, section 260A.07, subdivision 1, is amended to read:
    Subdivision 1. Establishment; referrals. A county attorney may establish a truancy
mediation program for the purpose of resolving truancy problems without court action. If
a student is in a school district or charter school that has established a school attendance
review board, the student may be referred to the county attorney under section 260A.06,
subdivision 3
. If the student's school district or charter school has not established a board,
the student may be referred to the county attorney by the school district or charter school
if the student continues to be truant after the parent or guardian has been sent or conveyed
the notice under section 260A.03.

    Sec. 9. APPROPRIATIONS.
    Subdivision 1. Department. The sums indicated in this section are appropriated
from the general fund to the Department of Education for the fiscal years designated.
    Subd. 2. Charter school building lease aid. For building lease aid under Minnesota
Statutes, section 124D.11, subdivision 4:

$
54,484,000
.....
2014

$
59,533,000
.....
2015
The 2014 appropriation includes $6,819,000 for 2013 and $47,665,000 for 2014.
The 2015 appropriation includes $7,502,000 for 2014 and $52,031,000 for 2015.

    Sec. 10. REVISOR'S INSTRUCTION; CHARTER SCHOOLS
RECODIFICATION.
The revisor of statutes, in consultation with K-12 education staff in House Research
and Senate Counsel and Research, shall prepare a recodification of Minnesota Statutes,
sections 124D.10 and 124D.11, including corresponding technical corrections and other
needed technical changes and shall submit the completed recodification to the chairs and
ranking minority members of the legislative committees having jurisdiction over K-12
education policy and finance.

ARTICLE 5
SPECIAL PROGRAMS

    Section 1. Minnesota Statutes 2012, section 15.059, subdivision 5b, is amended to read:
    Subd. 5b. Continuation dependent on federal law. Notwithstanding this section,
the following councils and committees do not expire unless federal law no longer requires
the existence of the council or committee:
(1) Rehabilitation Council for the Blind, created in section 248.10;
(2) Juvenile Justice Advisory Committee, created in section 299A.72;
(3) Governor's Workforce Development Council, created in section 116L.665;
(4) local workforce councils, created in section 116L.666, subdivision 2;
(5) Rehabilitation Council, created in section 268A.02, subdivision 2; and
(6) Statewide Independent Living Council, created in section 268A.02, subdivision
2
; and
(7) Interagency Coordinating Council, created in section 125A.28.

    Sec. 2. Minnesota Statutes 2012, section 124D.11, subdivision 5, is amended to read:
    Subd. 5. Special education aid. (a) Except as provided in subdivision 2, special
education aid must be paid to a charter school according to section 125A.76, as though
it were a school district.
(b) For fiscal year 2006, the charter school may charge tuition to the district of
residence as follows:
(1) if the charter school does not receive general education revenue on behalf of
the student according to subdivision 1, tuition shall be charged as provided in section
125A.11; or
(2) if the charter school receives general education revenue on behalf of the student
according to subdivision 1, tuition shall be charged as provided in section 127A.47,
subdivision 7
, paragraph (d).
(c) (b) For fiscal year 2007 2015 and later, the special education aid paid to the
charter school shall be adjusted as follows:
(1) if the charter school does not receive general education revenue on behalf of
the student according to subdivision 1, the aid shall be adjusted as provided in section
125A.11; or
(2) if the charter school receives general education revenue on behalf of the student
according to subdivision 1, the aid shall be adjusted as provided in section 127A.47,
subdivision 7
, paragraph paragraphs (b) to (d).
EFFECTIVE DATE.This section is effective for fiscal year 2015 and later.

    Sec. 3. Minnesota Statutes 2012, section 125A.0941, is amended to read:
125A.0941 DEFINITIONS.
(a) The following terms have the meanings given them.
(b) "Emergency" means a situation where immediate intervention is needed to
protect a child or other individual from physical injury or to prevent serious property
damage. Emergency does not mean circumstances such as: a child who does not respond
to a task or request and instead places his or her head on a desk or hides under a desk or
table; a child who does not respond to a staff person's request unless failing to respond
would result in physical injury to the child or other individual; or an emergency incident
has already occurred and no threat of physical injury currently exists.
(c) "Physical holding" means physical intervention intended to hold a child immobile
or limit a child's movement, where body contact is the only source of physical restraint,
and where immobilization is used to effectively gain control of a child in order to protect
the a child or other person individual from physical injury. The term physical holding does
not mean physical contact that:
(1) helps a child respond or complete a task;
(2) assists a child without restricting the child's movement;
(3) is needed to administer an authorized health-related service or procedure; or
(4) is needed to physically escort a child when the child does not resist or the child's
resistance is minimal.
(d) "Positive behavioral interventions and supports" means interventions and
strategies to improve the school environment and teach children the skills to behave
appropriately.
(e) "Prone restraint" means placing a child in a face down position.
(f) "Restrictive procedures" means the use of physical holding or seclusion in an
emergency. Restrictive procedures must not be used to punish or otherwise discipline a
child.
(g) "Seclusion" means confining a child alone in a room from which egress is barred.
Egress may be barred by an adult locking or closing the door in the room or preventing the
child from leaving the room. Removing a child from an activity to a location where the
child cannot participate in or observe the activity is not seclusion.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 4. Minnesota Statutes 2012, section 125A.0942, is amended to read:
125A.0942 STANDARDS FOR RESTRICTIVE PROCEDURES.
    Subdivision 1. Restrictive procedures plan. (a) Schools that intend to use
restrictive procedures shall maintain and make publicly accessible in an electronic format
on a school or district Web site or make a paper copy available upon request describing a
restrictive procedures plan for children with disabilities that includes at least the following:
(1) lists the list of restrictive procedures the school intends to use;
(2) describes how the school will implement a range of positive behavior strategies
and provide links to mental health services;
(3) describes how the school will monitor and review the use of restrictive
procedures, including:
(i) conducting post-use debriefings, consistent with subdivision 3, paragraph (a),
clause (5); and
(ii) convening an oversight committee to undertake a quarterly review of the use
of restrictive procedures based on patterns or problems indicated by similarities in the
time of day, day of the week, duration of the use of a procedure, the individuals involved,
or other factors associated with the use of restrictive procedures; the number of times a
restrictive procedure is used schoolwide and for individual children; the number and types
of injuries, if any, resulting from the use of restrictive procedures; whether restrictive
procedures are used in nonemergency situations; the need for additional staff training; and
proposed actions to minimize the use of restrictive procedures; and
(3) (4) includes a written description and documentation of the training staff
completed under subdivision 5.
(b) Schools annually must publicly identify oversight committee members who
must at least include:
(1) a mental health professional, school psychologist, or school social worker;
(2) an expert in positive behavior strategies;
(3) a special education administrator; and
(4) a general education administrator.
    Subd. 2. Restrictive procedures. (a) Restrictive procedures may be used only
by a licensed special education teacher, school social worker, school psychologist,
behavior analyst certified by the National Behavior Analyst Certification Board, a person
with a master's degree in behavior analysis, other licensed education professional,
paraprofessional under section 120B.363, or mental health professional under section
245.4871, subdivision 27, who has completed the training program under subdivision 5.
(b) A school shall make reasonable efforts to notify the parent on the same day a
restrictive procedure is used on the child, or if the school is unable to provide same-day
notice, notice is sent within two days by written or electronic means or as otherwise
indicated by the child's parent under paragraph (d).
(c) When restrictive procedures are used twice in 30 days or when a pattern emerges
and restrictive procedures are not included in a child's individualized education program
or behavior intervention plan, The district must hold a meeting of the individualized
education program team, conduct or review a functional behavioral analysis, review data,
consider developing additional or revised positive behavioral interventions and supports,
consider actions to reduce the use of restrictive procedures, and modify the individualized
education program or behavior intervention plan as appropriate. The district must hold
the meeting: within ten calendar days after district staff use restrictive procedures on two
separate school days within 30 calendar days or a pattern of use emerges and the child's
individualized education program or behavior intervention plan does not provide for using
restrictive procedures in an emergency; or at the request of a parent or the district after
restrictive procedures are used. The district must review use of restrictive procedures at a
child's annual individualized education program meeting when the child's individualized
education program provides for using restrictive procedures in an emergency.
(d) If the individualized education program team under paragraph (c) determines
that existing interventions and supports are ineffective in reducing the use of restrictive
procedures or the district uses restrictive procedures on a child on ten or more school days
during the same school year, the team, as appropriate, either must consult with other
professionals working with the child; consult with experts in behavior analysis, mental
health, communication, or autism; consult with culturally competent professionals;
review existing evaluations, resources, and successful strategies; or consider whether to
reevaluate the child.
(e) At the individualized education program meeting under paragraph (c), the team
must review any known medical or psychological limitations, including any medical
information the parent provides voluntarily, that contraindicate the use of a restrictive
procedure, consider whether to prohibit that restrictive procedure, and document any
prohibition in the individualized education program or behavior intervention plan.
(d) (f) An individualized education program team may plan for using restrictive
procedures and may include these procedures in a child's individualized education
program or behavior intervention plan; however, the restrictive procedures may be used
only in response to behavior that constitutes an emergency, consistent with this section.
The individualized education program or behavior intervention plan shall indicate how the
parent wants to be notified when a restrictive procedure is used.
    Subd. 3. Physical holding or seclusion. (a) Physical holding or seclusion may be
used only in an emergency. A school that uses physical holding or seclusion shall meet the
following requirements:
(1) the physical holding or seclusion must be is the least intrusive intervention
that effectively responds to the emergency;
(2) physical holding or seclusion is not used to discipline a noncompliant child;
(3) physical holding or seclusion must end ends when the threat of harm ends and
the staff determines that the child can safely return to the classroom or activity;
(3) (4) staff must directly observe observes the child while physical holding or
seclusion is being used;
(4) (5) each time physical holding or seclusion is used, the staff person who
implements or oversees the physical holding or seclusion shall document documents, as
soon as possible after the incident concludes, the following information:
(i) a description of the incident that led to the physical holding or seclusion;
(ii) why a less restrictive measure failed or was determined by staff to be
inappropriate or impractical;
(iii) the time the physical holding or seclusion began and the time the child was
released; and
(iv) a brief record of the child's behavioral and physical status;
(5) (6) the room used for seclusion must:
(i) be at least six feet by five feet;
(ii) be well lit, well ventilated, adequately heated, and clean;
(iii) have a window that allows staff to directly observe a child in seclusion;
(iv) have tamperproof fixtures, electrical switches located immediately outside the
door, and secure ceilings;
(v) have doors that open out and are unlocked, locked with keyless locks that
have immediate release mechanisms, or locked with locks that have immediate release
mechanisms connected with a fire and emergency system; and
(vi) not contain objects that a child may use to injure the child or others;
(6) (7) before using a room for seclusion, a school must:
(i) receive written notice from local authorities that the room and the locking
mechanisms comply with applicable building, fire, and safety codes; and
(ii) register the room with the commissioner, who may view that room; and
(7) (8) until August 1, 2013 2015, a school district may use prone restraints with
children age five or older under the following conditions if:
(i) a the district has provided to the department a list of staff who have had specific
training on the use of prone restraints;
(ii) a the district provides information on the type of training that was provided
and by whom;
(iii) prone restraints may only be used by staff who have received specific training
use prone restraints;
(iv) each incident of the use of prone restraints is reported to the department within
five working days on a form provided by the department; and
(v) a the district, prior to before using prone restraints, must review any known
medical or psychological limitations that contraindicate the use of prone restraints.
The department will report back to the chairs and ranking minority members of the
legislative committees with primary jurisdiction over education policy by February
1, 2013, on the use of prone restraints in the schools. Consistent with item (iv), The
department must collect data on districts' use of prone restraints and publish the data in a
readily accessible format on the department's Web site on a quarterly basis.
(b) The department must develop a statewide plan by February 1, 2013, to reduce
districts' use of restrictive procedures that includes By March 1, 2014, stakeholders must
recommend to the commissioner specific and measurable implementation and outcome
goals for reducing the use of restrictive procedures and the commissioner must submit to
the legislature a report on districts' progress in reducing the use of restrictive procedures
that recommends how to further reduce these procedures and eliminate the use of prone
restraints. The statewide plan includes the following components: measurable goals; the
resources, training, technical assistance, mental health services, and collaborative efforts
needed to significantly reduce districts' use of prone restraints; and recommendations
to clarify and improve the law governing districts' use of restrictive procedures. The
department must convene commissioner must consult with interested stakeholders to
develop the statewide plan and identify the need for technical assistance when preparing
the report, including representatives of advocacy organizations, special education directors,
teachers, paraprofessionals, intermediate school districts, school boards, day treatment
providers, county social services, state human services department staff, mental health
professionals, and autism experts. To assist the department and stakeholders under this
paragraph, school districts must report summary data to the department by July 1, 2012,
on districts' use of restrictive procedures during the 2011-2012 school year, including data
on the number of incidents involving restrictive procedures, the total number of students
on which restrictive procedures were used, the number of resulting injuries, relevant
demographic data on the students and school, and other relevant data collected by the
district. By June 30 each year, districts must report summary data on their use of restrictive
procedures to the department, in a form and manner determined by the commissioner.
    Subd. 4. Prohibitions. The following actions or procedures are prohibited:
(1) engaging in conduct prohibited under section 121A.58;
(2) requiring a child to assume and maintain a specified physical position, activity,
or posture that induces physical pain;
(3) totally or partially restricting a child's senses as punishment;
(4) presenting an intense sound, light, or other sensory stimuli using smell, taste,
substance, or spray as punishment;
(5) denying or restricting a child's access to equipment and devices such as walkers,
wheelchairs, hearing aids, and communication boards that facilitate the child's functioning,
except when temporarily removing the equipment or device is needed to prevent injury
to the child or others or serious damage to the equipment or device, in which case the
equipment or device shall be returned to the child as soon as possible;
(6) interacting with a child in a manner that constitutes sexual abuse, neglect, or
physical abuse under section 626.556;
(7) withholding regularly scheduled meals or water;
(8) denying access to bathroom facilities; and
(9) physical holding that restricts or impairs a child's ability to breathe, restricts or
impairs a child's ability to communicate distress, places pressure or weight on a child's
head, throat, neck, chest, lungs, sternum, diaphragm, back, or abdomen, or results in
straddling a child's torso.
    Subd. 5. Training for staff. (a) To meet the requirements of subdivision 1, staff
who use restrictive procedures, including paraprofessionals, shall complete training in
the following skills and knowledge areas:
(1) positive behavioral interventions;
(2) communicative intent of behaviors;
(3) relationship building;
(4) alternatives to restrictive procedures, including techniques to identify events and
environmental factors that may escalate behavior;
(5) de-escalation methods;
(6) standards for using restrictive procedures only in an emergency;
(7) obtaining emergency medical assistance;
(8) the physiological and psychological impact of physical holding and seclusion;
(9) monitoring and responding to a child's physical signs of distress when physical
holding is being used; and
(10) recognizing the symptoms of and interventions that may cause positional
asphyxia when physical holding is used.;
(11) district policies and procedures for timely reporting and documenting each
incident involving use of a restricted procedure; and
(12) schoolwide programs on positive behavior strategies.
(b) The commissioner, after consulting with the commissioner of human services,
must develop and maintain a list of training programs that satisfy the requirements of
paragraph (a). The commissioner also must develop and maintain a list of experts to
help individualized education program teams reduce the use of restrictive procedures.
The district shall maintain records of staff who have been trained and the organization
or professional that conducted the training. The district may collaborate with children's
community mental health providers to coordinate trainings.
    Subd. 6. Behavior supports. School districts are encouraged to establish effective
schoolwide systems of positive behavior interventions and supports. Nothing in this
section or section 125A.0941 precludes the use of reasonable force under sections
121A.582; 609.06, subdivision 1; and 609.379.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 5. Minnesota Statutes 2012, section 125A.11, subdivision 1, is amended to read:
    Subdivision 1. Nonresident tuition rate; other costs. (a) For fiscal year 2006,
when a school district provides instruction and services outside the district of residence,
board and lodging, and any tuition to be paid, shall be paid by the district of residence.
The tuition rate to be charged for any child with a disability, excluding a pupil for whom
tuition is calculated according to section 127A.47, subdivision 7, paragraph (d), must be
the sum of (1) the actual cost of providing special instruction and services to the child
including a proportionate amount for special transportation and unreimbursed building
lease and debt service costs for facilities used primarily for special education, plus (2)
the amount of general education revenue and referendum aid attributable to the pupil,
minus (3) the amount of special education aid for children with a disability received
on behalf of that child, minus (4) if the pupil receives special instruction and services
outside the regular classroom for more than 60 percent of the school day, the amount of
general education revenue and referendum aid, excluding portions attributable to district
and school administration, district support services, operations and maintenance, capital
expenditures, and pupil transportation, attributable to that pupil for the portion of time
the pupil receives special instruction and services outside of the regular classroom. If
the boards involved do not agree upon the tuition rate, either board may apply to the
commissioner to fix the rate. Notwithstanding chapter 14, the commissioner must then set
a date for a hearing or request a written statement from each board, giving each board
at least ten days' notice, and after the hearing or review of the written statements the
commissioner must make an order fixing the tuition rate, which is binding on both school
districts. General education revenue and referendum equalization aid attributable to a
pupil must be calculated using the resident district's average general education revenue
and referendum equalization aid per adjusted pupil unit.
    (b) (a) For fiscal year 2007 2015 and later, when a school district provides special
instruction and services for a pupil with a disability as defined in section 125A.02 outside
the district of residence, excluding a pupil for whom an adjustment to special education
aid is calculated according to section 127A.47, subdivision 7, paragraph (e) paragraphs (b)
to (d), special education aid paid to the resident district must be reduced by an amount
equal to (1) the actual cost of providing special instruction and services to the pupil,
including a proportionate amount for special transportation and unreimbursed building
lease and debt service costs for facilities used primarily for special education, plus (2)
the amount of general education revenue and referendum equalization aid attributable
to that pupil, calculated using the resident district's average general education revenue
and referendum equalization aid per adjusted pupil unit excluding basic skills revenue,
elementary sparsity revenue and secondary sparsity revenue, minus (3) the amount of
special education aid for children with a disability under section 125A.76 received on
behalf of that child, minus (4) if the pupil receives special instruction and services outside
the regular classroom for more than 60 percent of the school day, the amount of general
education revenue and referendum equalization aid, excluding portions attributable to
district and school administration, district support services, operations and maintenance,
capital expenditures, and pupil transportation, attributable to that pupil for the portion of
time the pupil receives special instruction and services outside of the regular classroom,
calculated using the resident district's average general education revenue and referendum
equalization aid per adjusted pupil unit excluding basic skills revenue, elementary sparsity
revenue and secondary sparsity revenue and the serving district's basic skills revenue,
elementary sparsity revenue and secondary sparsity revenue per adjusted pupil unit.
Notwithstanding clauses (1) and (4), for pupils served by a cooperative unit without a
fiscal agent school district, the general education revenue and referendum equalization
aid attributable to a pupil must be calculated using the resident district's average general
education revenue and referendum equalization aid excluding compensatory revenue,
elementary sparsity revenue, and secondary sparsity revenue. Special education aid paid
to the district or cooperative providing special instruction and services for the pupil
must be increased by the amount of the reduction in the aid paid to the resident district.
Amounts paid to cooperatives under this subdivision and section 127A.47, subdivision
7
, shall be recognized and reported as revenues and expenditures on the resident school
district's books of account under sections 123B.75 and 123B.76. If the resident district's
special education aid is insufficient to make the full adjustment, the remaining adjustment
shall be made to other state aid due to the district.
    (c) (b) Notwithstanding paragraphs paragraph (a) and (b) and section 127A.47,
subdivision 7
, paragraphs (b) to (d) and (e), a charter school where more than 30 percent
of enrolled students receive special education and related services, a site approved under
section 125A.515, an intermediate district, a special education cooperative, or a school
district that served as the applicant agency for a group of school districts for federal
special education aids for fiscal year 2006 may apply to the commissioner for authority to
charge the resident district an additional amount to recover any remaining unreimbursed
costs of serving pupils with a disability. The application must include a description of the
costs and the calculations used to determine the unreimbursed portion to be charged to the
resident district. Amounts approved by the commissioner under this paragraph must be
included in the tuition billings or aid adjustments under paragraph (a) or (b), or section
127A.47, subdivision 7, paragraph (d) or (e) paragraphs (b) to (d), as applicable.
    (d) (c) For purposes of this subdivision and section 127A.47, subdivision 7,
paragraphs (d) and (e), "general education revenue and referendum equalization aid"
means the sum of the general education revenue according to section 126C.10, subdivision
1, excluding alternative teacher compensation revenue, plus the referendum equalization
aid according to section 126C.17, subdivision 7, as adjusted according to section 127A.47,
subdivision 7, paragraphs (a) to (c).
EFFECTIVE DATE.This section is effective for fiscal year 2015 and later.

    Sec. 6. Minnesota Statutes 2012, section 125A.27, subdivision 8, is amended to read:
    Subd. 8. Eligibility for Part C. "Eligibility for Part C" means eligibility for
early childhood special education infant and toddler intervention services under section
125A.02 and Minnesota Rules.

    Sec. 7. Minnesota Statutes 2012, section 125A.27, subdivision 11, is amended to read:
    Subd. 11. Interagency child find systems. "Interagency child find systems" means
activities developed on an interagency basis with the involvement of interagency early
intervention committees and other relevant community groups, including primary referral
sources included in Code of Federal Regulations, title 34, section 303.303(c), using
rigorous standards to actively seek out, identify, and refer infants and young children,
with, or at risk of, disabilities, and their families, including a child to reduce the need for
future services. The child find system must mandate referrals for a child under the age of
three who: (1) is involved in the subject of a substantiated case of abuse or neglect, or
(2) is identified as directly affected by illegal substance abuse, or withdrawal symptoms
resulting from prenatal drug exposure, to reduce the need for future services. The referral
procedures must specify that a referral must occur within seven calendar days from the
date of identification.

    Sec. 8. Minnesota Statutes 2012, section 125A.27, subdivision 14, is amended to read:
    Subd. 14. Parent. "Parent" means the biological parent with parental rights,
adoptive parent, legal guardian, or surrogate parent "parent" as defined by Code of Federal
Regulations, title 34, section 303.27, or a surrogate parent appointed in accordance with
Code of Federal Regulations, title 34, section 303.422, or United States Code, title 20,
section 1439(a)(5).

    Sec. 9. Minnesota Statutes 2012, section 125A.28, is amended to read:
125A.28 STATE INTERAGENCY COORDINATING COUNCIL.
An Interagency Coordinating Council of at least 17, but not more than 25 members
is established, in compliance with Public Law 108-446, section 641. The members must
be appointed by the governor and reasonably represent the population of Minnesota.
Council members must elect the council chair, who may not be a representative of the
Department of Education. The representative of the commissioner may not serve as the
chair. The council must be composed of at least five parents, including persons of color,
of children with disabilities under age 12, including at least three parents of a child
with a disability under age seven, five representatives of public or private providers
of services for children with disabilities under age five, including a special education
director, county social service director, local Head Start director, and a community health
services or public health nursing administrator, one member of the senate, one member of
the house of representatives, one representative of teacher preparation programs in early
childhood-special education or other preparation programs in early childhood intervention,
at least one representative of advocacy organizations for children with disabilities under
age five, one physician who cares for young children with special health care needs, one
representative each from the commissioners of commerce, education, health, human
services, a representative from the state agency responsible for child care, foster care,
mental health, homeless coordinator of education of homeless children and youth, and a
representative from Indian health services or a tribal council. Section 15.059, subdivisions
2 to 5, apply to the council. The council must meet at least quarterly.
The council must address methods of implementing the state policy of developing
and implementing comprehensive, coordinated, multidisciplinary interagency programs of
early intervention services for children with disabilities and their families.
The duties of the council include recommending policies to ensure a comprehensive
and coordinated system of all state and local agency services for children under age five
with disabilities and their families. The policies must address how to incorporate each
agency's services into a unified state and local system of multidisciplinary assessment
practices, individual intervention plans, comprehensive systems to find children in need of
services, methods to improve public awareness, and assistance in determining the role of
interagency early intervention committees.
On the date that Minnesota Part C Annual Performance Report is submitted to the
federal Office of Special Education, the council must recommend to the governor and the
commissioners of education, health, human services, commerce, and employment and
economic development policies for a comprehensive and coordinated system.
Annually, the council must prepare and submit a report to the governor and the
secretary of the federal Department of Education on the status of early intervention
services and programs for infants and toddlers with disabilities and their families under
the Individuals with Disabilities Education Act, United States Code, title 20, sections
1471 to 1485 (Part C, Public Law 102-119), as operated in Minnesota. The Minnesota
Part C annual performance report may serve as the report.
Notwithstanding any other law to the contrary, the State Interagency Coordinating
Council expires on June 30, 2014 does not expire unless federal law no longer requires
the existence of the council or committee.

    Sec. 10. Minnesota Statutes 2012, section 125A.29, is amended to read:
125A.29 RESPONSIBILITIES OF COUNTY BOARDS AND SCHOOL
BOARDS.
(a) It is the joint responsibility of county boards and school boards to coordinate,
provide, and pay for appropriate services, and to facilitate payment for services from public
and private sources. Appropriate services for children eligible under section 125A.02 must
be determined in consultation with parents, physicians, and other educational, medical,
health, and human services providers. The services provided must be in conformity with:
(1) an IFSP for each eligible infant and toddler from birth through age two and
the infant's or toddler's family including:
(i) American Indian infants and toddlers with disabilities and their families residing
on a reservation geographically located in the state;
(ii) infants and toddlers with disabilities who are homeless children and their
families; and
(iii) infants and toddlers with disabilities who are wards of the state; or
(2) an individualized education program (IEP) or individual service plan (ISP) for
each eligible child ages three through four.
(b) Appropriate early intervention services include family education and
counseling, home visits, occupational and physical therapy, speech pathology, audiology,
psychological services, special instruction, nursing, respite, nutrition, assistive technology,
transportation and related costs, social work, vision services, case management services
provided in conformity with an IFSP that are designed to meet the special developmental
needs of an eligible child and the needs of the child's family related to enhancing the
child's development and that are selected in collaboration with the parent. These services
include core early intervention services and additional early intervention services listed in
this section and infant and toddler intervention services defined under United States Code,
title 20, sections 1431 to 1444, and Code of Federal Regulations, title 34, section 303,
including service coordination under section 125A.33, medical services for diagnostic and
evaluation purposes, early identification, and screening, assessment, and health services
necessary to enable children with disabilities to benefit from early intervention services.
(c) School and county boards shall coordinate early intervention services. In the
absence of agreements established according to section 125A.39, service responsibilities
for children birth through age two are as follows:
(1) school boards must provide, pay for, and facilitate payment for special education
and related services required under sections 125A.03 and 125A.06;
(2) county boards must provide, pay for, and facilitate payment for noneducational
services of social work, psychology, transportation and related costs, nursing, respite, and
nutrition services not required under clause (1).
(d) School and county boards may develop an interagency agreement according
to section 125A.39 to establish agency responsibility that assures early intervention
services are coordinated, provided, paid for, and that payment is facilitated from public
and private sources.
(e) County and school boards must jointly determine the primary agency in this
cooperative effort and must notify the commissioner of the state lead agency of their
decision.

    Sec. 11. Minnesota Statutes 2012, section 125A.30, is amended to read:
125A.30 INTERAGENCY EARLY INTERVENTION COMMITTEES.
(a) A school district, group of districts, or special education cooperative, in
cooperation with the health and human service agencies located in the county or counties
in which the district or cooperative is located, must establish an Interagency Early
Intervention Committee for children with disabilities under age five and their families
under this section, and for children with disabilities ages three to 22 consistent with
the requirements under sections 125A.023 and 125A.027. Committees must include
representatives of local health, education, and county human service agencies, county
boards, school boards, early childhood family education programs, Head Start, parents of
young children with disabilities under age 12, child care resource and referral agencies,
school readiness programs, current service providers, and agencies that serve families
experiencing homelessness, and may also include representatives from other private or
public agencies and school nurses. The committee must elect a chair from among its
members and must meet at least quarterly.
(b) The committee must develop and implement interagency policies and procedures
concerning the following ongoing duties:
(1) develop public awareness systems designed to inform potential recipient families,
especially parents with premature infants, or infants with other physical risk factors
associated with learning or development complications, of available programs and services;
(2) to reduce families' need for future services, and especially parents with premature
infants, or infants with other physical risk factors associated with learning or development
complications, implement interagency child find systems designed to actively seek out,
identify, and refer infants and young children with, or at risk of, disabilities, including
a child under the age of three who: (i) is involved in the subject of a substantiated case
of abuse or neglect or (ii) is identified as directly affected by illegal substance abuse, or
withdrawal symptoms resulting from prenatal drug exposure;
(3) establish and evaluate the identification, referral, child screening, evaluation,
child- and family-directed assessment systems, procedural safeguard process,
and community learning systems to recommend, where necessary, alterations and
improvements;
(4) assure the development of individualized family service plans for all eligible
infants and toddlers with disabilities from birth through age two, and their families,
and individualized education programs and individual service plans when necessary to
appropriately serve children with disabilities, age three and older, and their families and
recommend assignment of financial responsibilities to the appropriate agencies;
(5) implement a process for assuring that services involve cooperating agencies at all
steps leading to individualized programs;
(6) facilitate the development of a transitional transition plan if a service provider is
not recommended to continue to provide services in the individual family service plan by
the time a child is two years and nine months old;
(7) identify the current services and funding being provided within the community
for children with disabilities under age five and their families;
(8) develop a plan for the allocation and expenditure of additional state and federal
early intervention funds under United States Code, title 20, section 1471 et seq. (Part C,
Public Law 108-446) and United States Code, title 20, section 631, et seq. (Chapter I,
Public Law 89-313); and
(9) develop a policy that is consistent with section 13.05, subdivision 9, and federal
law to enable a member of an interagency early intervention committee to allow another
member access to data classified as not public.
(c) The local committee shall also:
(1) participate in needs assessments and program planning activities conducted by
local social service, health and education agencies for young children with disabilities
and their families; and.
(2) review and comment on the early intervention section of the total special
education system for the district, the county social service plan, the section or sections of
the community health services plan that address needs of and service activities targeted
to children with special health care needs, the section on children with special needs in
the county child care fund plan, sections in Head Start plans on coordinated planning and
services for children with special needs, any relevant portions of early childhood education
plans, such as early childhood family education or school readiness, or other applicable
coordinated school and community plans for early childhood programs and services, and
the section of the maternal and child health special project grants that address needs of and
service activities targeted to children with chronic illness and disabilities.

    Sec. 12. Minnesota Statutes 2012, section 125A.32, is amended to read:
125A.32 INDIVIDUALIZED FAMILY SERVICE PLAN (IFSP).
(a) A team must participate in IFSP meetings to develop the IFSP. The team shall
include:
(1) a parent or parents of the child, as defined in Code of Federal Regulations,
title 34, section 303.27;
(2) other family members, as requested by the parent, if feasible to do so;
(3) an advocate or person outside of the family, if the parent requests that the
person participate;
(4) the service coordinator who has been working with the family since the
initial referral, or who has been designated by the public agency to be responsible for
implementation of the IFSP and coordination with other agencies including transition
services; and
(5) a person or persons involved in conducting evaluations and assessments.; and
(6) as appropriate, persons who will be providing early intervention services under
the plan to the child or family.
(b) The IFSP must include:
(1) information about the child's developmental status;
(2) family information, with the consent of the family;
(3) measurable results or major outcomes expected to be achieved by the child with
the family's assistance, that include developmentally appropriate preliteracy and language
skills for the child, and the criteria, procedures, and timelines;
(4) specific early intervention services based on peer-reviewed research, to the
extent practicable, necessary to meet the unique needs of the child and the family to
achieve the outcomes;
(5) payment arrangements, if any;
(6) medical and other services that the child needs, but that are not required under
the Individual with Disabilities Education Act, United States Code, title 20, section 1471
et seq. (Part C, Public Law 108-446) including funding sources to be used in paying for
those services and the steps that will be taken to secure those services through public
or private sources;
(7) dates and duration of early intervention services;
(8) name of the service coordinator;
(9) steps to be taken to support a child's transition from early infant and toddler
intervention services to other appropriate services, including convening a transition
conference at least 90 days or, at the discretion of all parties, not more than nine months
before the child is eligible for preschool services; and
(10) signature of the parent and authorized signatures of the agencies responsible
for providing, paying for, or facilitating payment, or any combination of these, for early
infant and toddler intervention services.

    Sec. 13. Minnesota Statutes 2012, section 125A.33, is amended to read:
125A.33 SERVICE COORDINATION.
(a) The team responsible for the initial evaluation and the child- and family-directed
assessment and for developing the IFSP under section 125A.32, if appropriate, must
select a service coordinator to carry out service coordination activities on an interagency
basis. Service coordination must actively promote a family's capacity and competency
to identify, obtain, coordinate, monitor, and evaluate resources and services to meet the
family's needs. Service coordination activities include:
(1) coordinating the performance of evaluations and assessments;
(2) facilitating and participating in the development, review, and evaluation of
individualized family service plans;
(3) assisting families in identifying available service providers;
(4) coordinating and monitoring the delivery of available services;
(5) informing families of the availability of advocacy services;
(6) coordinating with medical, health, and other service providers;
(7) facilitating the development of a transition plan to preschool, school, or if
appropriate, to other services, at least 90 days before the time the child is no longer
eligible for early infant and toddler intervention services or, at the discretion of all parties,
not more than nine months prior to the child's eligibility for preschool services third
birthday, if appropriate;
(8) managing the early intervention record and submitting additional information to
the local primary agency at the time of periodic review and annual evaluations; and
(9) notifying a local primary agency when disputes between agencies impact service
delivery required by an IFSP.
(b) A service coordinator must be knowledgeable about children and families
receiving services under this section, requirements of state and federal law, and services
available in the interagency early childhood intervention system. The IFSP must include
the name of the services coordinator from the profession most relevant to the child's or
family's needs or who is otherwise qualified to carry out all applicable responsibilities
under the Individuals with Disabilities Education Act, United States Code, title 20,
sections 1471 to 1485 (Part C, Public Law 102-119), who will be responsible for
implementing the early intervention services identified in the child's IFSP, including
transition services, and coordination with other agencies and persons.

    Sec. 14. Minnesota Statutes 2012, section 125A.35, subdivision 1, is amended to read:
    Subdivision 1. Lead agency; allocation of resources. The state lead agency must
administer the early intervention account that consists of federal allocations. The Part C
state plan must state the amount of federal resources in the early intervention account
available for use by local agencies. The state lead agency must distribute the funds to the
local primary agency designated by an Interagency Early Intervention Committee based
on a formula that includes a December 1 count of the prior year of Part C eligible children
for the following purposes:
(1) as provided in Code of Federal Regulations, title 34, part 303.425 303.430, to
arrange for payment for early intervention services not elsewhere available, or to pay for
services during the pendency of a conflict procedure, including mediation, complaints, due
process hearings, and interagency disputes; and
(2) to support interagency child find system activities.

    Sec. 15. Minnesota Statutes 2012, section 125A.36, is amended to read:
125A.36 PAYMENT FOR SERVICES.
Core early intervention services must be provided at public expense with no cost to
parents. Parents must be requested to assist in the cost of additional early intervention
services by using third-party payment sources and applying for available resources.
Payment structures permitted under state law must be used to pay for additional early
intervention services. Parental financial responsibility must be clearly defined in the
IFSP. A parent's inability to pay must not prohibit a child from receiving needed early
intervention services.

    Sec. 16. Minnesota Statutes 2012, section 125A.43, is amended to read:
125A.43 MEDIATION PROCEDURE.
(a) The commissioner, or the commissioner's designee, of the state lead agency must
use federal funds to provide mediation for the activities in paragraphs (b) and (c).
(b) A parent may resolve a dispute regarding issues in section 125A.42, paragraph
(b)
, clause (5), through mediation. If the parent chooses mediation, mediation must be
voluntary on the part of the parties. The parent and the public agencies must complete the
mediation process within 30 calendar days of the date the Office of Dispute Resolution
Department of Education receives a parent's written request for mediation unless a district
declines mediation. The mediation process may not be used to delay a parent's right
to a due process hearing. The resolution of the written, signed mediation agreement is
not binding on any party both parties and is enforceable in any state court of competent
jurisdiction or in a district court of the United States.
(c) Resolution of a dispute through mediation, or other form of alternative dispute
resolution, is not limited to formal disputes arising from the objection of a parent or
guardian and is not limited to the period following a request for a due process hearing.
(d) The commissioner shall provide training and resources to school districts to
facilitate early identification of disputes and access to mediation.
(e) The local primary agency may request mediation on behalf of involved agencies
when there are disputes between agencies regarding responsibilities to coordinate, provide,
pay for, or facilitate payment for early intervention services.

    Sec. 17. Minnesota Statutes 2012, section 125A.76, subdivision 1, is amended to read:
    Subdivision 1. Definitions. (a) For the purposes of this section and section 125A.79,
the definitions in this subdivision apply.
    (a) (b) "Basic revenue" has the meaning given it in section 126C.10, subdivision 2.
For the purposes of computing basic revenue pursuant to this section, each child with a
disability shall be counted as prescribed in section 126C.05, subdivision 1.
    (b) (c) "Essential personnel" means teachers, cultural liaisons, related services, and
support services staff providing services to students. Essential personnel may also include
special education paraprofessionals or clericals providing support to teachers and students
by preparing paperwork and making arrangements related to special education compliance
requirements, including parent meetings and individualized education programs. Essential
personnel does not include administrators and supervisors.
    (c) (d) "Average daily membership" has the meaning given it in section 126C.05.
    (d) (e) "Program growth factor" means 1.046 for fiscal year years 2012 though 2015,
1.0 for fiscal year 2016, 1.046 for fiscal year 2017, and the product of 1.046 and the
program growth factor for the previous year for fiscal year 2018 and later.
(f) "Nonfederal special education expenditure" means all direct expenditures that
are necessary and essential to meet the district's obligation to provide special instruction
and services to children with a disability according to sections 124D.454, 125A.03 to
125A.24, 125A.259 to 125A.48, and 125A.65 as submitted by the district and approved by
the department under section 125A.75, subdivision 4, excluding expenditures:
(1) reimbursed with federal funds;
(2) reimbursed with other state aids under this chapter;
(3) for general education costs of serving students with a disability;
(4) for facilities;
(5) for pupil transportation; and
(6) for postemployment benefits.
(g) "Old formula special education expenditures" means expenditures eligible for
revenue under Minnesota Statutes 2012, section 125A.76, subdivision 2.
For the Minnesota State Academy for the Deaf and the Minnesota State Academy for the
Blind, expenditures are limited to the salary and fringe benefits of one-to-one instructional
and behavior management aides assigned to a child attending the academy, if the aides are
required by the child's individualized education program.
(h) "Cross subsidy reduction aid percentage" means 1.0 percent for fiscal year 2014
and 4.48 percent for fiscal year 2015.
(i) "Cross subsidy reduction aid limit" means $20 for fiscal year 2014 and $48
for fiscal year 2015.
(j) "Special education aid increase limit" means $80 for fiscal year 2016, $100 for
fiscal year 2017, and, for fiscal year 2018 and later, the sum of the special education aid
increase limit for the previous fiscal year and $40.
EFFECTIVE DATE.This section is effective for fiscal year 2014 and later.

    Sec. 18. Minnesota Statutes 2012, section 125A.76, is amended by adding a
subdivision to read:
    Subd. 2a. Special education initial aid. For fiscal year 2016 and later, a district's
special education initial aid equals the sum of:
(1) the lesser of 62 percent of the district's old formula special education
expenditures for the prior fiscal year, 50 percent of the district's nonfederal special
education expenditures for the prior year, or 56 percent of the product of the sum of the
following amounts, computed using prior fiscal year data, and the program growth factor:
(i) the product of the district's average daily membership served and the sum of:
(A) $450; plus
(B) $400 times the ratio of the sum of the number of pupils enrolled on October 1
who are eligible to receive free lunch plus one-half of the pupils enrolled on October 1
who are eligible to receive reduced-price lunch to the total October 1 enrollment; plus
(C) .008 times the district' s average daily membership served; plus
(ii) $10,400 times the December 1 child count for the primary disability areas of
autism spectrum disorders, developmental delay, and severely multiply impaired; plus
(iii) $18,000 times the December 1 child count for the primary disability areas of
deaf and hard-of-hearing and emotional or behavioral disorders; plus
(iv) $27,000 times the December 1 child count for the primary disability areas of
developmentally cognitive mild-moderate, developmentally cognitive severe-profound,
physically impaired, visually impaired, and deafblind; plus
(2) the cost of providing transportation services for children with disabilities under
section 123B.92, subdivision 1, paragraph (b), clause (4).
EFFECTIVE DATE.This section is effective for fiscal year 2016 and later.

    Sec. 19. Minnesota Statutes 2012, section 125A.76, is amended by adding a
subdivision to read:
    Subd. 2b. Cross subsidy reduction aid. For fiscal years 2014 and 2015, the cross
subsidy reduction aid for a school district, not including a charter school, equals the lesser
of (a) the product of the cross subsidy reduction aid limit and the district's average daily
membership served or (b) the product of the cross subsidy reduction aid percentage, the
district's average daily membership served and the sum of:
(1) $450; plus
(2) $400 times the ratio of the sum of the number of pupils enrolled on October 1
who are eligible to receive free lunch plus one-half of the pupils enrolled on October 1
who are eligible to receive reduced-price lunch to the total October 1 enrollment; plus
(3) .008 times the district's average daily membership served; plus
(i) $10,100 times the December 1 child count for the primary disability areas of
autism spectrum disorders, developmental delay, and severely multiply impaired; plus
(ii) $17,500 times the December 1 child count for the primary disability areas of
deaf and hard-of-hearing and emotional or behavioral disorders; plus
(iii) $26,000 times the December 1 child count for the primary disability areas of
developmentally cognitive mild-moderate, developmentally cognitive severe-profound,
physically impaired, visually impaired, and deafblind.

    Sec. 20. Minnesota Statutes 2012, section 125A.76, is amended by adding a
subdivision to read:
    Subd. 2c. Special education aid. (a) For fiscal year 2014 and fiscal year 2015, a
district's special education aid equals the sum of the district's special education initial aid
under subdivision 2a, the district's cross subsidy reduction aid under subdivision 2b, and
the district's excess cost aid under section 125A.79, subdivision 5.
(b) For fiscal year 2016 and later, a district's special education aid equals the sum of
the district's special education initial aid under subdivision 2a and the district's excess cost
aid under section 125A.79, subdivision 5.
(c) Notwithstanding paragraph (b), for fiscal year 2016, the special education aid for
a school district must not exceed the sum of the special education aid the district would
have received for fiscal year 2016 under Minnesota Statutes 2012, sections 125A.76
and 125A.79, as adjusted according to Minnesota Statutes 2012, sections 125A.11 and
127A.47, subdivision 7, and the product of the district's average daily membership served
and the special education aid increase limit.
(d) Notwithstanding paragraph (b), for fiscal year 2017 and later, the special education
aid for a school district must not exceed the sum of: (i) the product of the district's average
daily membership served and the special education aid increase limit and (ii) the product
of the sum of the special education aid the district would have received for fiscal year 2016
under Minnesota Statutes 2012, sections 125A.76 and 125A.79, as adjusted according
to Minnesota Statutes 2012, sections 125A.11 and 127A.47, subdivision 7, the ratio of
the district's average daily membership served for the current fiscal year to the district's
average daily membership served for fiscal year 2016, and the program growth factor.
(e) Notwithstanding paragraph (b), for fiscal year 2016 and later the special education
aid for a school district, not including a charter school, must not be less than the lesser of
(1) the district's nonfederal special education expenditures for that fiscal year or (2) the
product of the sum of the special education aid the district would have received for fiscal
year 2016 under Minnesota Statutes 2012, sections 125A.76 and 125A.79, as adjusted
according to Minnesota Statutes 2012, sections 125A.11 and 127A.47, subdivision 7, the
ratio of the district's adjusted daily membership for the current fiscal year to the district's
average daily membership for fiscal year 2016, and the program growth factor.
EFFECTIVE DATE.This section is effective for fiscal year 2014 and later.

    Sec. 21. Minnesota Statutes 2012, section 125A.76, is amended by adding a
subdivision to read:
    Subd. 2d. Statewide average expenditure. By January 15 of each year, the
department must calculate the statewide average special education expenditure per
December 1 child count for the prior fiscal year by primary disability area and provide that
information to all districts. By January 15 of each odd-numbered year, the commissioner
must identify options for aligning the assignment of disability areas to the categories and
the rates for each category in subdivision 2a, clause (1), with the latest expenditure data and
submit these options to the legislative committees with jurisdiction over education finance.
EFFECTIVE DATE.This section is effective July 1, 2015.

    Sec. 22. Minnesota Statutes 2012, section 125A.76, subdivision 4a, is amended to read:
    Subd. 4a. Adjustments for tuition reciprocity with adjoining states. (a) If an
agreement is reached between the state of Minnesota and an adjoining state pursuant to
section 124D.041 that requires a special education tuition payment from the state of
Minnesota to the adjoining state, the tuition payment shall be made from the special
education aid appropriation for that year, and the state total special education aid under
subdivision 4 shall be reduced by the amount of the payment.
    (b) If an agreement is reached between the state of Minnesota and an adjoining state
pursuant to section 124D.041 that requires a special education tuition payment from
an adjoining state to the state of Minnesota, the special education aid appropriation for
that year and the state total special education aid under subdivision 4 shall be increased
by the amount of the payment.
    (c) (b) If an agreement is reached between the state of Minnesota and an adjoining
state pursuant to section 124D.041 that requires special education tuition payments to
be made between the two states and not between districts in the two states, the special
education aid for a Minnesota school district serving a student with a disability from the
adjoining state shall be calculated according to section 127A.47, subdivision 7, except that
no reduction shall be made in the special education aid paid to the resident district.
EFFECTIVE DATE.This section is effective for fiscal year 2016 and later.

    Sec. 23. Minnesota Statutes 2012, section 125A.76, subdivision 8, is amended to read:
    Subd. 8. Special education forecast maintenance of effort. (a) If, on the basis of
a forecast of general fund revenues and expenditures under section 16A.103, the state's
expenditures for special education and related services for children with disabilities from
nonfederal sources for a fiscal year, including special education aid under section 125A.76;
special education excess cost aid under section 125A.76, subdivision 7 subdivision 2c;
travel for home-based services under section 125A.75, subdivision 1; aid for students with
disabilities under section 125A.75, subdivision 3; court-placed special education under
section 125A.79, subdivision 4; out-of-state tuition under section 125A.79, subdivision 8;
and direct expenditures by state agencies are projected to be less than the amount required
to meet federal special education maintenance of effort, the reimbursement percentages
for excess cost aid under section 125A.79, subdivision 5, must be increased as required to
ensure that the additional amount required to meet federal special education maintenance of
effort is added to the state total special education aid in section 125A.76, subdivision 4 2c.
    (b) If, on the basis of a forecast of general fund revenues and expenditures under
section 16A.103, expenditures in the programs in paragraph (a) are projected to be greater
than previously forecast for an enacted budget, and an addition to state total special
education aid has been made under paragraph (a), the state total special education aid
must be reduced by the lesser of the amount of the expenditure increase or the amount
previously added to state total special education aid in section 125A.76, subdivision 4 2c.
    (c) For the purpose of this section, "previously forecast for an enacted budget" means
the allocation of funding for these programs in the most recent forecast of general fund
revenues and expenditures or the act appropriating money for these programs, whichever
occurred most recently. It does not include planning estimates for a future biennium.
    (d) If the amount of special education aid is adjusted in accordance with this
subdivision, the commissioner of education shall notify the chairs of the legislative
committees having jurisdiction over kindergarten through grade 12 education regarding
the amount of the adjustment and provide an explanation of the federal maintenance of
effort requirements.
EFFECTIVE DATE.This section is effective for fiscal year 2016 and later.

    Sec. 24. Minnesota Statutes 2012, section 125A.78, subdivision 2, is amended to read:
    Subd. 2. Initial aid adjustment. For the fiscal year after approval of a district's
application, and thereafter, the special education initial aid under section 125A.76,
subdivision 1
, must be computed based on activities defined as reimbursable under
Department of Education rules for special education and nonspecial education students,
and additional activities as detailed and approved by the commissioner.
EFFECTIVE DATE.This section is effective for fiscal year 2016 and later.

    Sec. 25. Minnesota Statutes 2012, section 125A.79, subdivision 1, is amended to read:
    Subdivision 1. Definitions. For the purposes of this section, the definitions in this
subdivision apply.
    (a) "Unreimbursed old formula special education cost expenditures" means the
sum of the following:
    (1) old formula special education expenditures for teachers' salaries, contracted
services, supplies, equipment, and transportation services eligible for revenue under
section 125A.76 the prior fiscal year; plus minus
    (2) expenditures for tuition bills received under sections 125A.03 to 125A.24 and
125A.65 for services eligible for revenue under section 125A.76, subdivision 2; minus
    (3) revenue for teachers' salaries, contracted services, supplies, equipment, and
transportation services (2) special education initial aid under section 125A.76;, subdivision
2a; minus
    (4) tuition receipts under sections 125A.03 to 125A.24 and 125A.65 for services
eligible for revenue under section 125A.76, subdivision 2.
(3) the amount of general education revenue and referendum equalization aid for the
prior fiscal year attributable to pupils receiving special instruction and services outside the
regular classroom for more than 60 percent of the school day for the portion of time the
pupils receive special instruction and services outside the regular classroom, excluding
portions attributable to district and school administration, district support services,
operations and maintenance, capital expenditures, and pupil transportation.
(b) "Unreimbursed nonfederal special education expenditures" means:
(1) nonfederal special education expenditures for the prior fiscal year; minus
(2) special education initial aid under section 125A.76, subdivision 2a; minus
(3) the amount of general education revenue and referendum equalization aid for the
prior fiscal year attributable to pupils receiving special instruction and services outside the
regular classroom for more than 60 percent of the school day for the portion of time the
pupils receive special instruction and services outside of the regular classroom, excluding
portions attributable to district and school administration, district support services,
operations and maintenance, capital expenditures, and pupil transportation.
    (b) (c) "General revenue" for a school district means the sum of the general
education revenue according to section 126C.10, subdivision 1, excluding alternative
teacher compensation revenue, minus transportation sparsity revenue minus total operating
capital revenue. "General revenue" for a charter school means the sum of the general
education revenue according to section 124D.11, subdivision 1, and transportation revenue
according to section 124D.11, subdivision 2, excluding alternative teacher compensation
revenue, minus referendum equalization aid minus transportation sparsity revenue minus
operating capital revenue.
    (c) "Average daily membership" has the meaning given it in section 126C.05.
    (d) "Program growth factor" means 1.02 for fiscal year 2012 and later.

    Sec. 26. Minnesota Statutes 2012, section 125A.79, subdivision 5, is amended to read:
    Subd. 5. Initial excess cost aid. For fiscal years 2008 2016 and later, a district's
initial excess cost aid equals the greater of:
    (1) 75 56 percent of the difference between (i) the district's unreimbursed nonfederal
special education cost expenditures and (ii) 4.36 7.0 percent of the district's general
revenue; or
    (2) 62 percent of the difference between (i) the district's unreimbursed old formula
special education expenditures and (ii) 2.5 percent of the district's general revenue; or
    (2) (3) zero.
EFFECTIVE DATE.This section is effective for fiscal year 2016 and later.

    Sec. 27. Minnesota Statutes 2012, section 125A.79, subdivision 8, is amended to read:
    Subd. 8. Out-of-state tuition. For children who are residents of the state, receive
services under section 125A.76, subdivisions 1 and 2, and are placed in a care and
treatment facility by court action in a state that does not have a reciprocity agreement with
the commissioner under section 125A.155, the resident school district shall submit the
balance of the tuition bills, minus the general education revenue, excluding basic skills
revenue and alternative teacher compensation revenue, and referendum equalization aid
attributable to the pupil, calculated using the resident district's average general education
revenue and referendum equalization aid per adjusted pupil unit minus the special
education contracted services initial revenue attributable to the pupil.
EFFECTIVE DATE.This section is effective for fiscal year 2015 and later.

    Sec. 28. SPECIAL EDUCATION CASE LOADS TASK FORCE.
    Subdivision 1. Members. The commissioner shall establish and appoint a special
education case loads task force consisting of at least ten members who will provide equal
representation from school districts, including special education teachers, and advocacy
organizations, including parents of children with disabilities.
    Subd. 2. Duties. The special education case loads task force shall develop
recommendations for the appropriate numbers of students with disabilities that may be
assigned to a teacher both with and without paraprofessional support in the classroom and
for cost-effective and efficient strategies and structures for improving student outcomes.
The task force must also identify state rules that should be revised to align with state statute.
    Subd. 3. Report. The task force must submit a report by February 15, 2014, to the
education policy and finance committees of the legislature recommending appropriate
case loads for teachers of school-age children in all federal settings, including educational
service alternatives and proposed state rule revisions.
    Subd. 4. Expiration. The task force expires February 16, 2014.

    Sec. 29. RULEMAKING AUTHORITY.
The commissioner of education shall use the expedited rulemaking process in
Minnesota Statutes, section 14.389, to amend Minnesota Rules related to providing
special education under Part C of the Individuals with Disabilities Education Act. The
commissioner shall amend the rules to conform to new federal regulations in Code
of Federal Regulations, title 34, part 303, including definitions of and procedures for
evaluation and assessment, including assessment of the child and family, initial evaluation
and assessment, the use of native language, the use of informed clinical opinion as an
independent basis to establish eligibility, and transition of a toddler from Part C consistent
with Code of Federal Regulations, title 34, sections 303.24, 303.25, and 303.321, only
to the extent necessary to avoid loss of federal funds. The authority to use the expedited
process to amend rules specified in this section expires July 1, 2014. Rule amendments
adopted under the expedited process before that date remain in effect unless further
amended under the rulemaking procedures in Minnesota Statutes, chapter 14.

    Sec. 30. REPORT ON HOMELESS CHILDREN SERVED.
The commissioner of education must collect statistics on the number of homeless
children who have received Part C services and must annually report those results to
the legislature by July 1.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 31. APPROPRIATIONS.
    Subdivision 1. Department of Education. The sums indicated in this section are
appropriated from the general fund to the Department of Education for the fiscal years
designated.
    Subd. 2. Special education; regular. For special education aid under Minnesota
Statutes, section 125A.75:

$
997,725,000
.....
2014

$
1,108,211,000
.....
2015
The 2014 appropriation includes $118,232,000 for 2013 and $802,884,000 for 2014.
The 2015 appropriation includes $169,929,000 for 2014 and $938,282,000 for 2015.
    Subd. 3. Aid for children with disabilities. For aid under Minnesota Statutes,
section 125A.75, subdivision 3, for children with disabilities placed in residential facilities
within the district boundaries for whom no district of residence can be determined:

$
1,655,000
.....
2014

$
1,752,000
.....
2015
If the appropriation for either year is insufficient, the appropriation for the other
year is available.
    Subd. 4. Travel for home-based services. For aid for teacher travel for home-based
services under Minnesota Statutes, section 125A.75, subdivision 1:

$
345,000
.....
2014

$
355,000
.....
2015
The 2014 appropriation includes $45,000 for 2013 and $300,000 for 2014.
The 2015 appropriation includes $47,000 for 2014 and $308,000 for 2015.
    Subd. 5. Special education; excess costs. For excess cost aid under Minnesota
Statutes, section 125A.79, subdivision 7:

$
42,030,000
.....
2014
The 2014 appropriation includes $42,030,000 for 2013 and $0 for 2014.
    Subd. 6. Court-placed special education revenue. For reimbursing serving school
districts for unreimbursed eligible expenditures attributable to children placed in the serving
school district by court action under Minnesota Statutes, section 125A.79, subdivision 4:

$
54,000
.....
2014

$
55,000
.....
2015
    Subd. 7. Special education out-of-state tuition. For special education out-of-state
tuition according to Minnesota Statutes, section 125A.79, subdivision 8:

$
250,000
.....
2014

$
250,000
.....
2015
    Subd. 8. Special education paperwork cost savings. For special education
paperwork cost savings:

$
1,763,000
.....
2014
For a transfer to MNIT. This appropriation is available in fiscal year 2015 if not
expended.

    Sec. 32. REPEALER.
Minnesota Statutes 2012, sections 124D.454, subdivisions 3, 10, and 11; 125A.35,
subdivisions 4 and 5; 125A.76, subdivisions 2, 4, 5, and 7; and 125A.79, subdivisions 6
and 7, are repealed for fiscal year 2016 and later.

ARTICLE 6
FACILITIES AND TECHNOLOGY

    Section 1. Minnesota Statutes 2012, section 123B.53, subdivision 5, is amended to read:
    Subd. 5. Equalized debt service levy. (a) The equalized debt service levy of a
district equals the sum of the first tier equalized debt service levy and the second tier
equalized debt service levy.
(b) A district's first tier equalized debt service levy equals the district's first tier debt
service equalization revenue times the lesser of one or the ratio of:
(1) the quotient derived by dividing the adjusted net tax capacity of the district for
the year before the year the levy is certified by the adjusted pupil units in the district for
the school year ending in the year prior to the year the levy is certified; to
(2) $3,049 $3,550.
(c) A district's second tier equalized debt service levy equals the district's second tier
debt service equalization revenue times the lesser of one or the ratio of:
(1) the quotient derived by dividing the adjusted net tax capacity of the district for
the year before the year the levy is certified by the adjusted pupil units in the district for
the school year ending in the year prior to the year the levy is certified; to
(2) $7,622 $7,900.
EFFECTIVE DATE.This section is effective for revenue in fiscal year 2015 and
later.

    Sec. 2. Minnesota Statutes 2012, section 123B.54, is amended to read:
123B.54 DEBT SERVICE APPROPRIATION.
    (a) $21,727,000 in fiscal year 2014 and $24,201,000 in fiscal year 2015 and later
are The amount necessary to make debt service equalization aid payments under section
123B.53 is annually appropriated from the general fund to the commissioner of education
for payment of debt service equalization aid under section 123B.53.
    (b) The appropriations in paragraph (a) must be reduced by the amount of any
money specifically appropriated for the same purpose in any year from any state fund.

    Sec. 3. Minnesota Statutes 2012, section 123B.57, subdivision 4, is amended to read:
    Subd. 4. Health and safety levy. To receive health and safety revenue, a district
may levy an amount equal to the district's health and safety revenue as defined in
subdivision 3 multiplied by the lesser of one, or the ratio of the quotient derived by
dividing the adjusted net tax capacity of the district for the year preceding the year the
levy is certified by the adjusted marginal cost pupil units in the district for the school year
to which the levy is attributable, to $2,796 $3,165.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 4. Minnesota Statutes 2012, section 123B.591, subdivision 2, is amended to read:
    Subd. 2. Deferred maintenance revenue. The deferred maintenance revenue for
an eligible school district equals the product of $60 $64 times the adjusted marginal cost
pupil units for the school year times the lesser of one or the ratio of the district's average
age of building space to 35 years.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 5. Minnesota Statutes 2012, section 123B.591, subdivision 3, is amended to read:
    Subd. 3. Deferred maintenance levy. To obtain deferred maintenance revenue for
fiscal year 2008 and later, a district may levy an amount not more than the product of its
deferred maintenance revenue for the fiscal year times the lesser of one or the ratio of its
adjusted net tax capacity per adjusted marginal cost pupil unit to $5,621 $5,965.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 6. Minnesota Statutes 2012, section 125B.26, subdivision 4, is amended to read:
    Subd. 4. District aid. For fiscal year 2006 and later, a district, charter school,
or intermediate school district's Internet access equity aid equals the district, charter
school, or intermediate school district's approved cost for the previous fiscal year
according to subdivision 1 exceeding $15 $16 times the district's adjusted marginal
cost pupil units for the previous fiscal year or no reduction if the district is part of an
organized telecommunications access cluster. Equity aid must be distributed to the
telecommunications access cluster for districts, charter schools, or intermediate school
districts that are members of the cluster or to individual districts, charter schools, or
intermediate school districts not part of a telecommunications access cluster.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 7. Minnesota Statutes 2012, section 128D.11, subdivision 3, is amended to read:
    Subd. 3. No election. Subject to the provisions of subdivisions 7 to 10, the school
district may also by a two-thirds majority vote of all the members of its board of education
and without any election by the voters of the district, issue and sell in each calendar year
general obligation bonds of the district in an amount not to exceed 5-1/10 per cent of the
net tax capacity of the taxable property in the district (plus, for calendar years 1990 to
2003, an amount not to exceed $7,500,000, and for calendar years year 2004 to 2016 and
later, an amount not to exceed $15,000,000; with an additional provision that any amount
of bonds so authorized for sale in a specific year and not sold can be carried forward and
sold in the year immediately following).
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 8. Laws 2007, chapter 146, article 4, section 12, is amended to read:
    Sec. 12. BONDING AUTHORIZATION.
    To provide funds for the acquisition or betterment of school facilities, Independent
School District No. 625, St. Paul, may by two-thirds majority vote of all the members of
the board of directors issue general obligation bonds in one or more series for calendar
years 2008 through 2016, as provided in this section. The aggregate principal amount of
any bonds issued under this section for each calendar year must not exceed $15,000,000.
Issuance of the bonds is not subject to Minnesota Statutes, section 475.58 or 475.59.
The bonds must otherwise be issued as provided in Minnesota Statutes, chapter 475.
The authority to issue bonds under this section is in addition to any bonding authority
authorized by Minnesota Statutes, chapter 123B, or other law. The amount of bonding
authority authorized under this section must be disregarded in calculating the bonding
limit of Minnesota Statutes, chapter 123B, or any other law other than Minnesota Statutes,
section 475.53, subdivision 4.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 9. SCHOOL FACILITIES FINANCING WORK GROUP.
The commissioner of education must convene a working group to develop
recommendations for reforming the financing of prekindergarten through grade 12
education facilities to create adequate, equitable, and sustainable financing of public
school facilities throughout the state. Membership on the working group must include
representatives of school superintendents, business managers, school facilities directors,
and school boards. The scope of the working group recommendations must include
funding options for facilities projects currently financed with debt service, alternative
facilities, deferred maintenance, health and safety, building lease, and operating capital
revenues. The commissioner, on behalf of the working group, must submit a report to the
chairs and ranking minority members of the legislative committees and divisions with
primary jurisdiction over kindergarten through grade 12 education finance by February 1,
2014, recommending how best to allocate funds for school facilities.

    Sec. 10. CYRUS AND MORRIS SCHOOL DISTRICT CONSOLIDATION.
    Subdivision 1. Purpose. The legislature finds that an orderly, voluntary
consolidation of Independent School Districts Nos. 611, Cyrus, and 769, Morris, promotes
the well-being of the students and increases educational efficiency in those school districts.
    Subd. 2. Remediation costs. Independent School District No. 611, Cyrus, may
identify all health and safety remediation costs related to the demolition of the Cyrus
school building and submit those amounts to the commissioner of education for approval.
Any approved costs may be included either in the district's health and safety plan or in the
bonding authority authorized under subdivision 3.
    Subd. 3. Facility bonds. Independent School District No. 611, Cyrus, may issue
general obligation bonds without an election under Minnesota Statutes, chapter 475, after
a public meeting of the school board with notice given by mail according to Minnesota
Statutes, section 123B.09, subdivision 11, in an amount not to exceed $1,000,000
approved by the commissioner of education for the costs associated with demolishing the
Cyrus school building. The bonds must be repaid within ten years of issuance. Any excess
bond proceeds after bonds are repaid must be credited back to the taxpayers of the former
Independent School District No. 611, Cyrus.
    Subd. 4. Reorganization operating debt determined. Independent School District
No. 611, Cyrus, must estimate its reorganization operating debt according to Minnesota
Statutes, section 123B.82, and submit that amount to the commissioner of education
for approval.
    Subd. 5. Reorganization operating debt bonds. Independent School District No.
611, Cyrus, may issue general obligation bonds without an election under Minnesota
Statutes, chapter 475, after a public meeting of the school board with notice given by mail
according to Minnesota Statutes, section 123B.09, subdivision 11, in an amount not to
exceed the reorganization operating debt approved by the commissioner of education
under subdivision 4. The bonds must be repaid within six years of issuance.
    Subd. 6. Repayment. The bonded debt issued under this section remains payable
by the taxable property located within the boundaries of former Independent School
District No. 611, Cyrus.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 11. ELEVATOR REPAIR LEVY; NORMAN COUNTY WEST SCHOOL
DISTRICT.
For taxes payable in 2015 and 2016, Independent School District No. 2527,
Norman County West, may levy for an amount not to exceed $27,500 in each year. The
proceeds of this levy must be used to refurbish an existing elevator with new electrical and
mechanical components.
EFFECTIVE DATE.This section is effective for taxes payable in 2015 and 2016.

    Sec. 12. APPROPRIATIONS.
    Subdivision 1. Department of Education. The sums indicated in this section are
appropriated from the general fund to the Department of Education for the fiscal years
designated.
    Subd. 2. Health and safety revenue. For health and safety aid according to
Minnesota Statutes, section 123B.57, subdivision 5:

$
463,000
.....
2014

$
434,000
.....
2015
The 2014 appropriation includes $26,000 for 2013 and $437,000 for 2014.
The 2015 appropriation includes $68,000 for 2014 and $366,000 for 2015.
    Subd. 3. Debt service equalization. For debt service aid according to Minnesota
Statutes, section 123B.53, subdivision 6:

$
19,083,000
.....
2014

$
25,060,000
.....
2015
The 2014 appropriation includes $2,397,000 for 2013 and $16,686,000 for 2014.
The 2015 appropriation includes $2,626,000 for 2014 and $22,434,000 for 2015.
    Subd. 4. Alternative facilities bonding aid. For alternative facilities bonding aid,
according to Minnesota Statutes, section 123B.59, subdivision 1:

$
19,287,000
.....
2014

$
19,287,000
.....
2015
The 2014 appropriation includes $2,623,000 for 2013 and $16,664,000 for 2014.
The 2015 appropriation includes $2,623,000 for 2014 and $16,664,000 for 2015.
    Subd. 5. Equity in telecommunications access. For equity in telecommunications
access:

$
3,750,000
.....
2014

$
3,750,000
.....
2015
If the appropriation amount is insufficient, the commissioner shall reduce the
reimbursement rate in Minnesota Statutes, section 125B.26, subdivisions 4 and 5, and the
revenue for fiscal years 2014 and 2015 shall be prorated.
Any balance in the first year does not cancel but is available in the second year.
    Subd. 6. Deferred maintenance aid. For deferred maintenance aid, according to
Minnesota Statutes, section 123B.591, subdivision 4:

$
3,564,000
.....
2014

$
3,730,000
.....
2015
The 2014 appropriation includes $456,000 for 2013 and $3,108,000 for 2014.
The 2015 appropriation includes $489,000 for 2014 and $3,241,000 for 2015.

ARTICLE 7
NUTRITION, LIBRARIES, AND ACCOUNTING

    Section 1. Minnesota Statutes 2012, section 123B.75, subdivision 5, is amended to read:
    Subd. 5. Levy recognition. (a) For fiscal years 2009 and 2010, in June of each
year, the school district must recognize as revenue, in the fund for which the levy was
made, the lesser of:
(1) the sum of May, June, and July school district tax settlement revenue received in
that calendar year, plus general education aid according to section 126C.13, subdivision
4
, received in July and August of that calendar year; or
(2) the sum of:
(i) 31 percent of the referendum levy certified according to section 126C.17, in
calendar year 2000; and
(ii) the entire amount of the levy certified in the prior calendar year according to
section 124D.86, subdivision 4, for school districts receiving revenue under sections
124D.86, subdivision 3, clauses (1), (2), and (3); 126C.41, subdivisions 1, 2, paragraph (a),
and 3
, paragraphs (b), (c), and (d); 126C.43, subdivision 2; and 126C.48, subdivision 6; plus
(iii) zero percent of the amount of the levy certified in the prior calendar year for the
school district's general and community service funds, plus or minus auditor's adjustments,
not including the levy portions that are assumed by the state, that remains after subtracting
the referendum levy certified according to section 126C.17 and the amount recognized
according to item (ii).
(b) For fiscal year 2011 and later years, in June of each year, the school district must
recognize as revenue, in the fund for which the levy was made, the lesser of:
(1) the sum of May, June, and July school district tax settlement revenue received in
that calendar year, plus general education aid according to section 126C.13, subdivision
4
, received in July and August of that calendar year; or
(2) the sum of:
(i) the greater of 48.6 percent of the referendum levy certified according to section
126C.17 in the prior calendar year, or 31 percent of the referendum levy certified
according to section 126C.17 in calendar year 2000; plus
(ii) the entire amount of the levy certified in the prior calendar year according
to section 124D.4531, 124D.86, subdivision 4, for school districts receiving revenue
under sections 124D.86, subdivision 3, clauses (1), (2), and (3); 124D.862, for Special
School District No. 1, Minneapolis, Independent School District No. 625, St. Paul, and
Independent School District No. 709, Duluth; 126C.41, subdivisions 1, 2, paragraph (a),
and 3, paragraphs (b), (c), and (d); 126C.43, subdivision 2; and 126C.48, subdivision 6; plus
(iii) 48.6 percent of the amount of the levy certified in the prior calendar year for the
school district's general and community service funds, plus or minus auditor's adjustments,
that remains after subtracting the referendum levy certified according to section 126C.17
and the amount recognized according to item (ii).

    Sec. 2. Minnesota Statutes 2012, section 124D.111, subdivision 1, is amended to read:
    Subdivision 1. School lunch aid computation. Each school year, the state must pay
participants in the national school lunch program the amount of 12 12.5 cents for each full
paid, reduced reduced-price, and free student lunch served to students.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 3. Minnesota Statutes 2012, section 124D.119, is amended to read:
124D.119 SUMMER FOOD SERVICE REPLACEMENT AID.
States funds are available to compensate department-approved summer food
program sponsors for reduced federal operating reimbursement rates under Public Law
104-193, the federal summer food service program. A sponsor is eligible for summer food
service replacement aid equal to the sum of the following amounts:. Reimbursement shall
be made on December 15 based on total meals served by each sponsor from the end of the
school year to the beginning of the next school year on a pro rata basis.
(1) for breakfast service, up to four cents per breakfast served by the sponsor during
the current program year;
(2) for lunch or supper service, up to 14 cents per lunch or supper served by the
sponsor during the current program year; and
(3) for supplement service, up to ten cents per supplement served by the sponsor
during the current program year.

    Sec. 4. Minnesota Statutes 2012, section 127A.45, subdivision 12a, is amended to read:
    Subd. 12a. Forward shifted aid payments. (a) Nineteen percent of the state aid
in fiscal year 1999, and 31 percent of the state aid in fiscal years 2000 and later received
under section 124D.86 must be paid by the state to the recipient school district on July 15
of that year. The recipient school district must recognize this aid in the same fiscal year
as the levy is recognized.
(b) One hundred percent of the state aid in fiscal years 2003 and later received under
section 124D.87 must be paid by the state to the recipient school district on August 30 of
that year. The recipient school district must recognize this aid in the previous fiscal year.

    Sec. 5. Minnesota Statutes 2012, section 127A.45, subdivision 13, is amended to read:
    Subd. 13. Aid payment percentage. Except as provided in subdivisions 11, 12,
12a, and 14, each fiscal year, all education aids and credits in this chapter and chapters
120A, 120B, 121A, 122A, 123A, 123B, 124D, 125A, 125B, 126C, 134, and section
273.1392, shall be paid at the current year aid payment percentage of the estimated
entitlement during the fiscal year of the entitlement. For the purposes of this subdivision,
a district's estimated entitlement for special education excess cost aid under section
125A.79 125A.76 for fiscal year 2006 2014 and later equals 74.0 97.4 percent of the
district's entitlement for the current fiscal year. The final adjustment payment, according
to subdivision 9, must be the amount of the actual entitlement, after adjustment for actual
data, minus the payments made during the fiscal year of the entitlement.

    Sec. 6. Minnesota Statutes 2012, section 134.32, is amended to read:
134.32 GRANT AUTHORIZATION; TYPES OF GRANTS AND AID.
    Subdivision 1. Provision of grants. The department shall provide the grants and aid
specified in this section from any available state, federal, or other funds.
    Subd. 3. Regional library basic system support grants aid. It shall provide
regional library basic system support grants aid to regional public library systems which
meet the requirements of section 134.34, to assist those systems in providing basic system
services.
    Subd. 4. Special project grants. It may provide special project grants to assist
innovative and experimental library programs including, but not limited to, special
services for American Indians and the Spanish-speaking, delivery of library materials to
homebound persons, other extensions of library services to persons without access to
libraries and projects to strengthen and improve library services.
    Subd. 5. Interlibrary exchange grants. It may provide grants for interlibrary
exchange of books, periodicals, resource material, reference information and the expenses
incident to the sharing of library resources and materials, including planning, development
and operating grants to multicounty, multitype library systems.
    Subd. 6. Library service grants. It may provide grants for the improvement of
library services at welfare and corrections institutions and for library service for the blind
and physically disabled.
    Subd. 7. Construction or remodeling grants. It may provide grants for
construction or remodeling of library facilities from any state and federal funds specifically
appropriated for this purpose.
    Subd. 8. Rulemaking. (a) The commissioner shall promulgate rules consistent
with sections 134.32 to 134.355 governing:
(1) applications for these grants and aid;
(2) computation formulas for determining the amounts of establishment grants and
regional library basic system support grants aid; and
(3) eligibility criteria for grants and aid.
(b) To the extent allowed under federal law, a construction grant applicant, in
addition to the points received under Minnesota Rules, part 3530.2632, shall receive an
additional five points if the construction grant is for a project combining public library
services and school district library services at a single location.

    Sec. 7. Minnesota Statutes 2012, section 134.34, is amended to read:
134.34 REGIONAL LIBRARY BASIC SYSTEM SUPPORT GRANTS AID;
REQUIREMENTS.
    Subdivision 1. Local support levels. (a) A Regional library basic system support
grant aid shall be made provided to any regional public library system where there are at
least three participating counties and where each participating city and county is providing
for public library service support the lesser of (a) an amount equivalent to .82 percent of
the average of the adjusted net tax capacity of the taxable property of that city or county,
as determined by the commissioner of revenue for the second, third, and fourth year
preceding that calendar year or (b) a per capita amount calculated under the provisions of
this subdivision. The per capita amount is established for calendar year 1993 as $7.62.
In succeeding calendar years, the per capita amount shall be increased by a percentage
equal to one-half of the percentage by which the total state adjusted net tax capacity of
property as determined by the commissioner of revenue for the second year preceding
that calendar year increases over that total adjusted net tax capacity for the third year
preceding that calendar year.
(b) The minimum level of support specified under this subdivision or subdivision 4
shall be certified annually to the participating cities and counties by the Department of
Education. If a city or county chooses to reduce its local support in accordance with
subdivision 4, paragraph (b) or (c), it shall notify its regional public library system. The
regional public library system shall notify the Department of Education that a revised
certification is required. The revised minimum level of support shall be certified to the
city or county by the Department of Education.
(c) A city which is a part of a regional public library system shall not be required to
provide this level of support if the property of that city is already taxable by the county for
the support of that regional public library system. In no event shall the Department of
Education require any city or county to provide a higher level of support than the level
of support specified in this section in order for a system to qualify for a regional library
basic system support grant aid. This section shall not be construed to prohibit a city or
county from providing a higher level of support for public libraries than the level of
support specified in this section.
    Subd. 3. Regional designation. Regional library basic system support grants aid
shall be made provided only to those regional public library systems officially designated
by the commissioner of education as the appropriate agency to strengthen, improve and
promote public library services in the participating areas. The commissioner of education
shall designate no more than one such regional public library system located entirely within
any single development region existing under sections 462.381 to 462.398 or chapter 473.
    Subd. 4. Limitation. (a) For calendar year 2010 and later, a regional library basic
system support grant aid shall not be made provided to a regional public library system
for a participating city or county which decreases the dollar amount provided for support
for operating purposes of public library service below the amount provided by it for the
second, or third preceding year, whichever is less. For purposes of this subdivision and
subdivision 1, any funds provided under section 473.757, subdivision 2, for extending
library hours of operation shall not be considered amounts provided by a city or county for
support for operating purposes of public library service. This subdivision shall not apply
to participating cities or counties where the adjusted net tax capacity of that city or county
has decreased, if the dollar amount of the reduction in support is not greater than the dollar
amount by which support would be decreased if the reduction in support were made in
direct proportion to the decrease in adjusted net tax capacity.
(b) For calendar year 2009 and later, in any calendar year in which a city's or
county's aid under sections 477A.011 to 477A.014 or credit reimbursement under section
273.1384 is reduced after the city or county has certified its levy payable in that year, it
may reduce its local support by the lesser of:
(1) ten percent; or
(2) a percent equal to the ratio of the aid and credit reimbursement reductions to the
city's or county's revenue base, based on aids certified for the current calendar year. For
calendar year 2009 only, the reduction under this paragraph shall be based on 2008 aid and
credit reimbursement reductions under the December 2008 unallotment, as well as any
aid and credit reimbursement reductions in calendar year 2009. For pay 2009 only, the
commissioner of revenue will calculate the reductions under this paragraph and certify
them to the commissioner of education within 15 days of May 17, 2009.
(c) For taxes payable in 2010 and later, in any payable year in which the total
amounts certified for city or county aids under sections 477A.011 to 477A.014 are less
than the total amounts paid under those sections in the previous calendar year, a city or
county may reduce its local support by the lesser of:
(1) ten percent; or
(2) a percent equal to the ratio of:
(i) the difference between (A) the sum of the aid it was paid under sections
477A.011 to 477A.014 and the credit reimbursement it received under section 273.1384
in the previous calendar year and (B) the sum of the aid it is certified to be paid in the
current calendar year under sections 477A.011 to 477A.014 and the credit reimbursement
estimated to be paid under section 273.1384; to
(ii) its revenue base for the previous year, based on aids actually paid in the previous
calendar year. The commissioner of revenue shall calculate the percent aid cut for each
county and city under this paragraph and certify the percentage cuts to the commissioner
of education by August 1 of the year prior to the year in which the reduced aids and
credit reimbursements are to be paid. The percentage of reduction related to reductions
to credit reimbursements under section 273.1384 shall be based on the best estimation
available as of July 30.
(d) Notwithstanding paragraph (a), (b), or (c), no city or county shall reduce its
support for public libraries below the minimum level specified in subdivision 1.
(e) For purposes of this subdivision, "revenue base" means the sum of:
(1) its levy for taxes payable in the current calendar year, including the levy on
the fiscal disparities distribution under section 276A.06, subdivision 3, paragraph (a),
or 473F.08, subdivision 3, paragraph (a);
(2) its aid under sections 477A.011 to 477A.014 in the current calendar year; and
(3) its taconite aid in the current calendar year under sections 298.28 and 298.282.
    Subd. 7. Proposed budget. In addition to the annual report required in section
134.13, a regional public system that receives a basic system support grant aid under this
section must provide each participating county and city with its proposed budget for
the next year.

    Sec. 8. Minnesota Statutes 2012, section 134.351, subdivision 3, is amended to read:
    Subd. 3. Agreement. In order for a multicounty, multitype library system to qualify
for a planning, development or operating grant aid pursuant to sections 134.353 and
134.354, each participating library in the system shall adopt an organizational agreement
providing for the following:
(a) Sharing of resources among all participating libraries;
(b) Long-range planning for cooperative programs;
(c) The development of a delivery system for services and programs;
(d) The development of a bibliographic database; and
(e) A communications system among all cooperating libraries.

    Sec. 9. Minnesota Statutes 2012, section 134.351, subdivision 7, is amended to read:
    Subd. 7. Reports. Each multicounty, multitype system receiving a grant aid
pursuant to section 134.353 or 134.354 shall provide an annual progress report to the
Department of Education.

    Sec. 10. Minnesota Statutes 2012, section 134.353, is amended to read:
134.353 MULTICOUNTY, MULTITYPE LIBRARY SYSTEM
DEVELOPMENT GRANT AID.
The commissioner of education may provide development grants aid to multicounty,
multitype library systems. In awarding a development grant aid, the commissioner shall
consider the extra costs incurred in systems located in sparsely populated and large
geographic regions.

    Sec. 11. Minnesota Statutes 2012, section 134.354, is amended to read:
134.354 MULTICOUNTY, MULTITYPE LIBRARY SYSTEM OPERATING
GRANT AID.
The commissioner of education may provide operating grants aid to multicounty,
multitype library systems. In awarding an operating grant aid, the commissioner shall
consider the extra costs incurred in systems located in sparsely populated and large
geographic areas.

    Sec. 12. Minnesota Statutes 2012, section 134.355, subdivision 1, is amended to read:
    Subdivision 1. Appropriations. Basic system support grants aid and regional library
telecommunications aid provide the appropriations for the basic regional library system.

    Sec. 13. Minnesota Statutes 2012, section 134.355, subdivision 2, is amended to read:
    Subd. 2. Grant application. Any regional public library system which qualifies
according to the provisions of section 134.34 may apply for an annual grant aid for
regional library basic system support. Regional public library districts under section
134.201 may not compensate board members using grant aid funds. The amount of each
grant aid for each fiscal year shall be calculated as provided in this section.

    Sec. 14. Minnesota Statutes 2012, section 134.355, subdivision 3, is amended to read:
    Subd. 3. Per capita distribution. Fifty-seven and one-half percent of the available
grant aid funds shall be distributed to provide all qualifying systems an equal amount
per capita. Each system's allocation pursuant to this subdivision shall be based on the
population it serves.

    Sec. 15. Minnesota Statutes 2012, section 134.355, subdivision 4, is amended to read:
    Subd. 4. Per square mile distribution. Twelve and one-half percent of the
available grant aid funds shall be distributed to provide all qualifying systems an equal
amount per square mile. Each system's allocation pursuant to this subdivision shall be
based on the area it serves.

    Sec. 16. Minnesota Statutes 2012, section 134.355, subdivision 5, is amended to read:
    Subd. 5. Base grant aid distribution. Five percent of the available grant aid funds
shall be paid to each system as a base grant aid for basic system services.

    Sec. 17. Minnesota Statutes 2012, section 134.355, subdivision 6, is amended to read:
    Subd. 6. Adjusted net tax capacity per capita distribution. Twenty-five percent
of the available grant aid funds shall be distributed to regional public library systems based
upon the adjusted net tax capacity per capita for each member county or participating
portion of a county as calculated for the second year preceding the fiscal year for which
the grant aid is made provided. Each system's entitlement shall be calculated as follows:
(a) Multiply the adjusted net tax capacity per capita for each county or participating
portion of a county by .0082.
(b) Add sufficient grant aid funds that are available under this subdivision to raise
the amount of the county or participating portion of a county with the lowest value
calculated according to paragraph (a) to the amount of the county or participating portion
of a county with the next highest value calculated according to paragraph (a). Multiply the
amount of the additional grant aid funds by the population of the county or participating
portion of a county.
(c) Continue the process described in paragraph (b) by adding sufficient grant aid
funds that are available under this subdivision to the amount of a county or participating
portion of a county with the next highest value calculated in paragraph (a) to raise it and
the amount of counties and participating portions of counties with lower values calculated
in paragraph (a) up to the amount of the county or participating portion of a county
with the next highest value, until reaching an amount where funds available under this
subdivision are no longer sufficient to raise the amount of a county or participating portion
of a county and the amount of counties and participating portions of counties with lower
values up to the amount of the next highest county or participating portion of a county.
(d) If the point is reached using the process in paragraphs (b) and (c) at which the
remaining grant aid funds under this subdivision are not adequate for raising the amount of
a county or participating portion of a county and all counties and participating portions of
counties with amounts of lower value to the amount of the county or participating portion
of a county with the next highest value, those funds are to be divided on a per capita basis
for all counties or participating portions of counties that received grant aid funds under
the calculation in paragraphs (b) and (c).

    Sec. 18. Minnesota Statutes 2012, section 134.36, is amended to read:
134.36 RULES.
The commissioner of education shall promulgate rules as necessary for
implementation of library grant and aid programs.

    Sec. 19. FUND TRANSFER; FISCAL YEARS 2014 AND 2015 ONLY.
(a) Notwithstanding Minnesota Statutes, section 123B.80, subdivision 3, for
fiscal years 2014 and 2015 only, the commissioner must approve a request for a fund
transfer if the transfer does not increase state aid obligations to the district or result in
additional property tax authority for the district. This section does not permit transfers
from the community service fund, the food service fund, or the reserved account for
staff development under section 122A.61.
(b) A school board may approve a fund transfer under paragraph (a) only after
adopting a resolution stating the fund transfer will not diminish instructional opportunities
for students.
EFFECTIVE DATE.This section is effective July 1, 2013.

    Sec. 20. ACCELERATED REPAYMENT OF EDUCATION AIDS.
(a) No later than September 30, 2013, the commissioner of management and budget
must estimate the amount of any positive unrestricted budgetary general fund balance at
the close of the fiscal year ending June 30, 2013. The commissioner must allocate the
amount estimated to the purposes and in the manner specified in Minnesota Statutes,
section 16A.152, subdivision 2, paragraph (a), clauses (3) and (4), in that order.
(b) The amounts necessary to meet the requirements of this section are appropriated
from the general fund as necessary to meet the appropriations schedules otherwise
established in statute.
(c) The commissioner of management and budget shall certify the total dollar
amount of the reductions to the purposes specified in Minnesota Statutes, section 16A.152,
subdivision 2, paragraph (a), clauses (3) and (4), to the commissioner of education. The
commissioner of education shall increase the aid payment percentage and reduce the
property tax shift percentage by these amounts and apply those reductions to the current
fiscal year and thereafter.
(d) No later than October 15, 2013, the commissioner of management and budget
must notify the chairs and ranking minority members of the senate committee on finance,
the house of representatives committee on ways and means, and the legislative committees
with jurisdiction over education of:
(1) the amount of positive unrestricted budgetary general fund balance estimated
under paragraph (a); and
(2) the dollar amount of reductions certified under paragraph (c) and the resulting
changes in the aid payment percentage and property tax shift percentage.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 21. APPROPRIATIONS.
    Subdivision 1. Department of Education. The sums indicated in this section are
appropriated from the general fund to the Department of Education for the fiscal years
designated.
    Subd. 2. School lunch. For school lunch aid according to Minnesota Statutes,
section 124D.111, and Code of Federal Regulations, title 7, section 210.17:

$
13,032,000
.....
2014

$
13,293,000
.....
2015
    Subd. 3. School breakfast. For traditional school breakfast aid under Minnesota
Statutes, section 124D.1158:

$
5,711,000
.....
2014

$
6,022,000
.....
2015
    Subd. 4. Kindergarten milk. For kindergarten milk aid under Minnesota Statutes,
section 124D.118:

$
1,039,000
.....
2014

$
1,049,000
.....
2015
    Subd. 5. Summer food service replacement aid. For summer food service
replacement aid under Minnesota Statutes, section 124D.119:

$
150,000
.....
2014

$
150,000
.....
2015
    Subd. 6. Basic system support. For basic system support grants under Minnesota
Statutes, section 134.355:

$
13,570,000
.....
2014

$
13,570,000
.....
2015
The 2014 appropriation includes $1,845,000 for 2013 and $11,725,000 for 2014.
The 2015 appropriation includes $1,845,000 for 2014 and $11,725,000 for 2015.
    Subd. 7. Multicounty, multitype library systems. For grants under Minnesota
Statutes, sections 134.353 and 134.354, to multicounty, multitype library systems:

$
1,300,000
.....
2014

$
1,300,000
.....
2015
The 2014 appropriation includes $176,000 for 2013 and $1,124,000 for 2014.
The 2015 appropriation includes $176,000 for 2014 and $1,124,000 for 2015.
    Subd. 8. Electronic library for Minnesota. For statewide licenses to online
databases selected in cooperation with the Minnesota Office of Higher Education for
school media centers, public libraries, state government agency libraries, and public
or private college or university libraries:

$
900,000
.....
2014

$
900,000
.....
2015
Any balance in the first year does not cancel but is available in the second year.
    Subd. 9. Regional library telecommunications aid. For regional library
telecommunications aid under Minnesota Statutes, section 134.355:

$
2,300,000
.....
2014

$
2,300,000
.....
2015
The 2014 appropriation includes $312,000 for 2013 and $1,988,000 for 2014.
The 2015 appropriation includes $312,000 for 2014 and $1,988,000 for 2015.

    Sec. 22. REVISOR'S INSTRUCTION.
In Minnesota Statutes and Minnesota Rules, the revisor of statutes shall substitute
the term "Division of State Library Services" for "Library Development and Services,"
"Office of Library Development and Services," or "LDS" where "LDS" stands for "Library
Development and Services." The revisor shall also make grammatical changes related
to the changes in terms.

    Sec. 23. REPEALER.
Minnesota Statutes 2012, section 123B.75, subdivision 6a, is repealed.

ARTICLE 8
EARLY CHILDHOOD EDUCATION, SELF-SUFFICIENCY, AND
LIFELONG LEARNING

    Section 1. [16F.01] MINNESOTA YOUTH COUNCIL COMMITTEE.
    Subdivision 1. Establishment and membership. The Minnesota Youth Council
Committee is established within and under the auspices of the Minnesota Alliance With
Youth. The committee consists of four members from each congressional district in
Minnesota and four members selected at-large. Members must be selected through an
application and interview process conducted by the Minnesota Alliance With Youth. In
making its appointments, the Minnesota Alliance With Youth should strive to ensure
gender and ethnic diversity in the committee's membership. Members must be between
the ages of 13 and 19 and serve two-year terms, except that one-half of the initial members
must serve a one-year term. Members may serve a maximum of two terms.
    Subd. 2. Duties. The Minnesota Youth Council Committee shall:
(1) provide advice and recommendations to the legislature and the governor on
issues affecting youth;
(2) serve as a liaison for youth around the state to the legislature and the governor; and
(3) submit an annual report of the council's activities and goals.
    Subd. 3. Partnerships. The Minnesota Youth Council Committee shall partner with
nonprofits, the private sector, and educational resources to fulfill its duties.
    Subd. 4. Youth Council Committee in the legislature. (a) The Minnesota Youth
Council Committee shall meet at least twice each year during the regular session of the
legislature.
(b) The committee may:
(1) select introduced bills in the house of representatives and senate for consideration
for a public hearing before the committee;
(2) propose youth legislation;
(3) provide advisory opinions to the legislature on bills heard before the committee;
and
(4) prepare a youth omnibus bill.
(c) The leaders of the majority and minority parties of the house of representatives
and senate shall each appoint one legislator to serve as a legislative liaison to the
committee. Leadership of the house of representatives and senate, on rotating years, may
appoint a staff member to staff the committee.

    Sec. 2. [124D.165] EARLY LEARNING SCHOLARSHIPS.
    Subdivision 1. Establishment; purpose. There is established an early learning
scholarships program in order to increase access to high-quality early childhood programs
for children ages three to five.
    Subd. 2. Family eligibility. (a) For a family to receive an early childhood education
scholarship, parents or guardians must meet the following eligibility requirements:
(1) have a child three or four years of age on September 1 of the current year, who
has not yet started kindergarten; and
(2) have income equal to or less than 185 percent of federal poverty level income
in the current calendar year, or be able to document their child's current participation in
the free and reduced-price lunch program or child and adult care food program, National
School Lunch Act, United States Code, title 42, sections 1751 and 1766; Head Start under
the federal Improving Head Start for School Readiness Act of 2007; Minnesota family
investment program under chapter 256J; child care assistance programs under chapter
119B; the supplemental nutrition assistance program; or placement in foster care under
section 260C.212.
(b) Notwithstanding the other provisions of this section, a parent under age 21 who
is pursuing a high school or general education equivalency diploma is eligible for an early
learning scholarship if the parent has a child age zero to five years old and meets the
income eligibility guidelines in this subdivision.
(c) Any siblings between the ages zero to five years old of a child who has been
awarded a scholarship under this section must be awarded a scholarship upon request,
provided the sibling attends the same program.
(d) A child who has received a scholarship under this section must continue to receive
a scholarship each year until that child is eligible for kindergarten under section 120A.20.
(e) Early learning scholarships may not be counted as earned income for the
purposes of medical assistance under chapter 256B, MinnesotaCare under chapter 256L,
Minnesota family investment program under chapter 256J, child care assistance programs
under chapter 119B, or Head Start under the federal Improving Head Start for School
Readiness Act of 2007.
    Subd. 3. Administration. (a) The commissioner shall establish application
timelines and determine the schedule for awarding scholarships that meets operational
needs of eligible families and programs. The commissioner may prioritize applications on
factors including family income, geographic location, and whether the child's family is on a
waiting list for a publicly funded program providing early education or child care services.
(b) Scholarships may be awarded up to $5,000 for each eligible child per year.
(c) A four-star rated program that has children eligible for a scholarship enrolled
in or on a waiting list for a program beginning in July, August, or September may notify
the commissioner, in the form and manner prescribed by the commissioner, each year
of the program's desire to enhance program services or to serve more children than
current funding provides. The commissioner may designate a predetermined number of
scholarship slots for that program and notify the program of that number.
(d) A scholarship is awarded for a 12-month period. If the scholarship recipient has
not been accepted and subsequently enrolled in a rated program within ten months of the
awarding of the scholarship, the scholarship cancels and the recipient must reapply in
order to be eligible for another scholarship. A child may not be awarded more than one
scholarship in a 12-month period.
(e) A child who receives a scholarship who has not completed development
screening under sections 121A.16 to 121A.19 must complete that screening within 90
days of first attending an eligible program.
    Subd. 4. Early childhood program eligibility. (a) In order to be eligible to accept
an early childhood education scholarship, a program must:
(1) participate in the quality rating and improvement system under section
124D.142; and
(2) beginning July 1, 2016, have a three- or four-star rating in the quality rating
and improvement system.
(b) Any program accepting scholarships must use the revenue to supplement and not
supplant federal funding.
    Subd. 5. Report required. The commissioner shall contract with an independent
contractor to evaluate the early learning scholarship program. The evaluation must
include recommendations regarding the appropriate scholarship amount, efficiency, and
effectiveness of the administration, and impact on kindergarten readiness.

    Sec. 3. Minnesota Statutes 2012, section 124D.531, subdivision 1, is amended to read:
    Subdivision 1. State total adult basic education aid. (a) The state total adult basic
education aid for fiscal year 2011 equals $44,419,000, plus any amount that is not paid
during the previous fiscal year as a result of adjustments under subdivision 4, paragraph
(a), or section 124D.52, subdivision 3. The state total adult basic education aid for later
fiscal years equals:
    (1) the state total adult basic education aid for the preceding fiscal year plus any
amount that is not paid for during the previous fiscal year, as a result of adjustments under
subdivision 4, paragraph (a), or section 124D.52, subdivision 3; times
    (2) the lesser of:
    (i) 1.02 1.025; or
    (ii) the average growth in state total contact hours over the prior ten program years.
    Beginning in fiscal year 2002, two percent of the state total adult basic education
aid must be set aside for adult basic education supplemental service grants under section
124D.522.
    (b) The state total adult basic education aid, excluding basic population aid, equals
the difference between the amount computed in paragraph (a), and the state total basic
population aid under subdivision 2.
EFFECTIVE DATE.This section is effective for revenue for fiscal year 2015
and later.

    Sec. 4. Laws 2011, First Special Session chapter 11, article 7, section 2, subdivision 8,
as amended by Laws 2012, chapter 239, article 3, section 4, is amended to read:
    Subd. 8. Early childhood education scholarships. For grants to early childhood
education scholarships for public or private early childhood preschool programs for
children ages 3 to 5:

$
2,000,000
.....
2013
(a) All children whose parents or legal guardians meet the eligibility requirements
of paragraph (b) established by the commissioner are eligible to receive early childhood
education scholarships under this section.
(b) A parent or legal guardian is eligible for an early childhood education scholarship
if the parent or legal guardian:
(1) has a child three or four years of age on September 1, beginning in calendar
year 2012; and
(2)(i) has income equal to or less than 47 percent of the state median income in the
current calendar year; or
(ii) can document their child's identification through another public funding
eligibility process, including the Free and Reduced Price Lunch Program, National School
Lunch Act, United States Code, title 42, section 1751, part 210; Head Start under federal
Improving Head Start for School Readiness Act of 2007; Minnesota family investment
program under chapter 256J; and child care assistance programs under chapter 119B.
Early childhood scholarships may not be counted as earned income for the purposes of
medical assistance, MinnesotaCare, Minnesota family investment program, child care
assistance, or Head Start programs.
Each year, if this appropriation is insufficient to provide early childhood education
scholarships to all eligible children, the Department of Education shall make scholarships
available on a first-come, first-served basis.
The commissioner of education shall submit a written report to the education
committees of the legislature by January 15, 2012, describing its plan for implementation
of scholarships under this subdivision for the 2012-2013 school year.
Any balance in the first year does not cancel but is available in the second year.
The base for this program is $3,000,000 each year.
EFFECTIVE DATE.This section is effective the day following final enactment
and applies to early learning scholarships received during fiscal year 2013.

    Sec. 5. APPROPRIATIONS.
    Subdivision 1. Department of Education. The sums indicated in this section are
appropriated from the general fund to the Department of Education for the fiscal years
designated.
    Subd. 2. School readiness. For revenue for school readiness programs under
Minnesota Statutes, sections 124D.15 and 124D.16:

$
10,095,000
.....
2014

$
10,159,000
.....
2015
The 2014 appropriation includes $1,372,000 for 2013 and $8,723,000 for 2014.
The 2015 appropriation includes $1,372,000 for 2014 and $8,787,000 for 2015.
    Subd. 3. Early childhood family education aid. For early childhood family
education aid under Minnesota Statutes, section 124D.135:

$
22,078,000
.....
2014

$
22,425,000
.....
2015
The 2014 appropriation includes $3,008,000 for 2013 and $19,070,000 for 2014.
The 2015 appropriation includes $3,001,000 for 2014 and $19,424,000 for 2015.
    Subd. 4. Health and developmental screening aid. For health and developmental
screening aid under Minnesota Statutes, sections 121A.17 and 121A.19:

$
3,421,000
.....
2014

$
3,344,000
.....
2015
The 2014 appropriation includes $474,000 for 2013 and $2,947,000 for 2014.
The 2015 appropriation includes $463,000 for 2014 and $2,881,000 for 2015.
    Subd. 5. Head Start program. For Head Start programs under Minnesota Statutes,
section 119A.52:

$
20,100,000
.....
2014

$
20,100,000
.....
2015
    Subd. 6. Educate parents partnership. For the educate parents partnership under
Minnesota Statutes, section 124D.129:

$
49,000
.....
2014

$
49,000
.....
2015
    Subd. 7. Kindergarten entrance assessment initiative and intervention
program. For the kindergarten entrance assessment initiative and intervention program
under Minnesota Statutes, section 124D.162:

$
281,000
.....
2014

$
281,000
.....
2015
    Subd. 8. Early childhood education scholarships. For transfer to the Office of
Early Learning for early learning scholarships under Minnesota Statutes, section 124D.165:

$
23,000,000
.....
2014

$
23,000,000
.....
2015
Up to $950,000 each year is for administration of this program.
Any balance in the first year does not cancel but is available in the second year.
    Subd. 9. Parent-child home program. For a grant to the parent-child home
program:

$
250,000
.....
2014

$
250,000
.....
2015
The grant must be used for an evidence-based and research-validated early childhood
literacy and school readiness program for children ages 16 months to four years at its
existing suburban program location. The program must expand to one additional urban
and one additional rural program location for fiscal years 2014 and 2015.
    Subd. 10. Community education aid. For community education aid under
Minnesota Statutes, section 124D.20:

$
935,000
.....
2014

$
1,056,000
.....
2015
The 2014 appropriation includes $118,000 for 2013 and $817,000 for 2014.
The 2015 appropriation includes $128,000 for 2014 and $928,000 for 2015.
    Subd. 11. Adults with disabilities program aid. For adults with disabilities
programs under Minnesota Statutes, section 124D.56:

$
710,000
.....
2014

$
710,000
.....
2015
The 2014 appropriation includes $96,000 for 2013 and $614,000 for 2014.
The 2015 appropriation includes $96,000 for 2014 and $614,000 for 2015.
    Subd. 12. Hearing-impaired adults. For programs for hearing-impaired adults
under Minnesota Statutes, section 124D.57:

$
70,000
.....
2014

$
70,000
.....
2015
    Subd. 13. School-age care revenue. For extended day aid under Minnesota
Statutes, section 124D.22:

$
1,000
.....
2014

$
1,000
.....
2015
The 2014 appropriation includes $0 for 2013 and $1,000 for 2014.
The 2015 appropriation includes $0 for 2014 and $1,000 for 2015.
    Subd. 14. Adult basic education aid. For adult basic education aid under
Minnesota Statutes, section 124D.531:

$
47,005,000
.....
2014

$
48,145,000
.....
2015
The 2014 appropriation includes $6,284,000 for 2013 and $40,721,000 for 2014.
The 2015 appropriation includes $6,409,000 for 2014 and $41,736,000 for 2015.
    Subd. 15. GED tests. For payment of 60 percent of the costs of GED tests under
Minnesota Statutes, section 124D.55:

$
125,000
.....
2014

$
125,000
.....
2015
    Subd. 16. Education and employment solution. For a grant to the Minneapolis
Urban League for education and employment solutions for young adults:

$
600,000
.....
2014
Any balance in fiscal year 2014 does not cancel and is available in fiscal year 2015.
This is a onetime appropriation.

ARTICLE 9
STATE AGENCIES

    Section 1. APPROPRIATIONS; DEPARTMENT OF EDUCATION.
    Subdivision 1. Department of Education. Unless otherwise indicated, the sums
indicated in this section are appropriated from the general fund to the Department of
Education for the fiscal years designated.
    Subd. 2. Department. (a) For the Department of Education:

$
20,058,000
.....
2014

$
19,308,000
.....
2015
Any balance in the first year does not cancel but is available in the second year.
(b) $260,000 each year is for the Minnesota Children's Museum.
(c) $41,000 each year is for the Minnesota Academy of Science.
(d) $50,000 each year is for the Duluth Children's Museum.
(e) $618,000 each year is for the Board of Teaching. Any balance in the first year
does not cancel but is available in the second year.
(f) $167,000 each year is for the Board of School Administrators. Any balance in
the first year does not cancel but is available in the second year.
(g) The expenditures of federal grants and aids as shown in the biennial budget
document and its supplements are approved and appropriated and shall be spent as
indicated.
(h) None of the amounts appropriated under this subdivision may be used for
Minnesota's Washington, D.C. office.
(i) $250,000 each year is for the School Finance Division to enhance financial data
analysis.
(j) $750,000 in fiscal year 2014 only is for departmental costs associated with
teacher development and evaluation. Any balance in the first year does not cancel and
is available in the second year.
    Subd. 3. Licensure by portfolio. For licensure by portfolio:

$
30,000
.....
2014

$
30,000
.....
2015
This appropriation is from the educator licensure portfolio account of the special
revenue fund.

    Sec. 2. APPROPRIATIONS; MINNESOTA STATE ACADEMIES.
The sums indicated in this section are appropriated from the general fund to the
Minnesota State Academies for the Deaf and the Blind for the fiscal years designated:

$
11,749,000
.....
2014

$
11,664,000
.....
2015
$85,000 of the fiscal year 2014 appropriation is for costs associated with upgrading
kitchen facilities. Any balance in the first year does not cancel but is available in the
second year.

    Sec. 3. APPROPRIATIONS; PERPICH CENTER FOR ARTS EDUCATION.
The sums in this section are appropriated from the general fund to the Perpich
Center for Arts Education for the fiscal years designated:

$
6,773,000
.....
2014

$
6,773,000
.....
2015
Any balance in the first year does not cancel but is available in the second year.

ARTICLE 10
FORECAST ADJUSTMENTS
A. GENERAL EDUCATION

    Section 1. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 1, is amended to read:
    Subd. 2. General education aid. For general education aid under Minnesota
Statutes, section 126C.13, subdivision 4:

$
5,379,068,000
.....
2012


$
5,844,995,000
7,153,701,000
.....
2013
The 2012 appropriation includes $1,660,922,000 for 2011 and $3,718,146,000
for 2012.
The 2013 appropriation includes $2,038,568,000 for 2012 and $3,806,427,000
$5,115,133,000 for 2013.

    Sec. 2. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 2, is amended to read:
    Subd. 3. Enrollment options transportation. For transportation of pupils attending
postsecondary institutions under Minnesota Statutes, section 124D.09, or for transportation
of pupils attending nonresident districts under Minnesota Statutes, section 124D.03:

$
42,000
.....
2012


$
46,000
40,000
.....
2013

    Sec. 3. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
4, as amended by Laws 2012, chapter 292, article 2, section 3, is amended to read:
    Subd. 4. Abatement revenue. For abatement aid under Minnesota Statutes, section
127A.49:

$
1,406,000
.....
2012


$
2,072,000
2,503,000
.....
2013
The 2012 appropriation includes $346,000 for 2011 and $1,060,000 for 2012.
The 2013 appropriation includes $588,000 for 2012 and $1,484,000 $1,915,000
for 2013.

    Sec. 4. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
5, as amended by Laws 2012, chapter 292, article 2, section 4, is amended to read:
    Subd. 5. Consolidation transition. For districts consolidating under Minnesota
Statutes, section 123A.485:

$
145,000
.....
2012


$
193,000
260,000
.....
2013
The 2012 appropriation includes $145,000 for 2011 and $0 for 2012.
The 2013 appropriation includes $0 for 2012 and $193,000 $260,000 for 2013.

    Sec. 5. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
6, as amended by Laws 2012, chapter 292, article 2, section 5, is amended to read:
    Subd. 6. Nonpublic pupil education aid. For nonpublic pupil education aid under
Minnesota Statutes, sections 123B.40 to 123B.43 and 123B.87:

$
14,302,000
.....
2012


$
15,594,000
18,969,000
.....
2013
The 2012 appropriation includes $4,161,000 for 2011 and $10,141,000 for 2012.
The 2013 appropriation includes $5,629,000 for 2012 and $9,965,000 $13,340,000
for 2013.

    Sec. 6. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
7, as amended by Laws 2012, chapter 292, article 2, section 6, is amended to read:
    Subd. 7. Nonpublic pupil transportation. For nonpublic pupil transportation aid
under Minnesota Statutes, section 123B.92, subdivision 9:

$
17,757,000
.....
2012


$
19,036,000
23,648,000
.....
2013
The 2012 appropriation includes $5,700,000 for 2011 and $12,057,000 for 2012.
The 2013 appropriation includes $6,694,000 for 2012 and $12,342,000 $16,954,000
for 2013.

    Sec. 7. Laws 2011, First Special Session chapter 11, article 1, section 36, subdivision
10, as amended by Laws 2012, chapter 292, article 2, section 7, is amended to read:
    Subd. 10. Compensatory pilot project formula aid. For grants for compensatory
pilot project formula aid as calculated under this subdivision:


$
9,368,000
13,403,000
.....
2013
For fiscal year 2013 only, a district which has a pupil unit count that is in the top 20
largest pupil unit counts is eligible for the greater of zero or $1,400 times the number of
compensatory pupil units, minus the amount of compensatory education revenue received
by the district under Minnesota Statutes, section 126C.10, subdivision 3.
The 2013 appropriation includes $0 for 2012 and $9,368,000 $13,403,000 for 2013.
This is a onetime appropriation.
B. EDUCATION EXCELLENCE

    Sec. 8. Laws 2011, First Special Session chapter 11, article 2, section 50, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 8, is amended to read:
    Subd. 2. Charter school building lease aid. For building lease aid under Minnesota
Statutes, section 124D.11, subdivision 4:

$
42,806,000
.....
2012


$
48,978,000
60,067,000
.....
2013
The 2012 appropriation includes $12,642,000 for 2011 and $30,164,000 for 2012.
The 2013 appropriation includes $16,746,000 for 2012 and $32,232,000 $43,321,000
for 2013.

    Sec. 9. Laws 2011, First Special Session chapter 11, article 2, section 50, subdivision
4, as amended by Laws 2012, chapter 292, article 2, section 10, is amended to read:
    Subd. 4. Integration aid. For integration aid under Minnesota Statutes, section
124D.86:

$
61,181,000
.....
2012


$
65,498,000
79,329,000
.....
2013
The 2012 appropriation includes $19,272,000 for 2011 and $41,909,000 for 2012.
The 2013 appropriation includes $23,268,000 for 2012 and $42,230,000 $56,061,000
for 2013.
The base for the final payment in fiscal year 2014 for fiscal year 2013 is $31,668,000
$17,197,000.

    Sec. 10. Laws 2011, First Special Session chapter 11, article 2, section 50, subdivision
5, as amended by Laws 2012, chapter 292, article 2, section 11, is amended to read:
    Subd. 5. Literacy incentive aid. For literacy incentive aid under Minnesota
Statutes, section 124D.98:


$
31,241,000
41,978,000
.....
2013
The 2013 appropriation includes $0 for 2012 and $31,241,000 $41,978,000 for 2013.

    Sec. 11. Laws 2011, First Special Session chapter 11, article 2, section 50, subdivision
6, as amended by Laws 2012, chapter 292, article 2, section 12, is amended to read:
    Subd. 6. Interdistrict desegregation or integration transportation grants. For
interdistrict desegregation or integration transportation grants under Minnesota Statutes,
section 124D.87:

$
13,262,000
.....
2012


$
13,966,000
13,260,000
.....
2013

    Sec. 12. Laws 2011, First Special Session chapter 11, article 2, section 50, subdivision
7, as amended by Laws 2012, chapter 292, article 2, section 13, is amended to read:
    Subd. 7. Success for the future. For American Indian success for the future grants
under Minnesota Statutes, section 124D.81:

$
2,013,000
.....
2012


$
2,137,000
2,609,000
.....
2013
The 2012 appropriation includes $638,000 for 2011 and $1,375,000 for 2012.
The 2013 appropriation includes $762,000 for 2012 and $1,375,000 $1,847,000
for 2013.

    Sec. 13. Laws 2011, First Special Session chapter 11, article 2, section 50, subdivision
9, as amended by Laws 2012, chapter 292, article 2, section 14, is amended to read:
    Subd. 9. Tribal contract schools. For tribal contract school aid under Minnesota
Statutes, section 124D.83:

$
1,791,000
.....
2012


$
1,969,000
2,353,000
.....
2013
The 2012 appropriation includes $600,000 for 2011 and $1,191,000 for 2012.
The 2013 appropriation includes $660,000 for 2012 and $1,309,000 $1,693,000
for 2013.
C. SPECIAL EDUCATION

    Sec. 14. Laws 2011, First Special Session chapter 11, article 3, section 11, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 15, is amended to read:
    Subd. 2. Special education; regular. For special education aid under Minnesota
Statutes, section 125A.75:

$
767,845,000
.....
2012


$
856,386,000
1,046,423,000
.....
2013
The 2012 appropriation includes $235,975,000 for 2011 and $531,870,000 for 2012.
The 2013 appropriation includes $295,299,000 for 2012 and $561,087,000
$751,124,000 for 2013.

    Sec. 15. Laws 2011, First Special Session chapter 11, article 3, section 11, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 16, is amended to read:
    Subd. 3. Aid for children with disabilities. For aid under Minnesota Statutes,
section 125A.75, subdivision 3, for children with disabilities placed in residential facilities
within the district boundaries for whom no district of residence can be determined:

$
1,508,000
.....
2012


$
1,593,000
1,570,000
.....
2013
If the appropriation for either year is insufficient, the appropriation for the other
year is available.

    Sec. 16. Laws 2011, First Special Session chapter 11, article 3, section 11, subdivision
4, as amended by Laws 2012, chapter 292, article 2, section 17, is amended to read:
    Subd. 4. Travel for home-based services. For aid for teacher travel for home-based
services under Minnesota Statutes, section 125A.75, subdivision 1:

$
314,000
.....
2012


$
321,000
407,000
.....
2013
The 2012 appropriation includes $107,000 for 2011 and $207,000 for 2012.
The 2013 appropriation includes $114,000 for 2012 and $207,000 $293,000 for 2013.

    Sec. 17. Laws 2011, First Special Session chapter 11, article 3, section 11, subdivision
5, as amended by Laws 2012, chapter 292, article 2, section 18, is amended to read:
    Subd. 5. Special education; excess costs. For excess cost aid under Minnesota
Statutes, section 125A.79, subdivision 7:

$
107,557,000
.....
2012


$
115,269,000
134,121,000
.....
2013
The 2012 appropriation includes $53,449,000 for 2011 and $54,108,000 for 2012.
The 2013 appropriation includes $59,607,000 for 2012 and $55,662,000 $74,514,000
for 2013.
D. FACILITIES AND TECHNOLOGY

    Sec. 18. Laws 2011, First Special Session chapter 11, article 4, section 10, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 19, is amended to read:
    Subd. 2. Health and safety revenue. For health and safety aid according to
Minnesota Statutes, section 123B.57, subdivision 5:

$
98,000
.....
2012


$
157,000
200,000
.....
2013
The 2012 appropriation includes $39,000 for 2011 and $59,000 for 2012.
The 2013 appropriation includes $32,000 for 2012 and $125,000 $168,000 for 2013.

    Sec. 19. Laws 2011, First Special Session chapter 11, article 4, section 10, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 20, is amended to read:
    Subd. 3. Debt service equalization. For debt service aid according to Minnesota
Statutes, section 123B.53, subdivision 6:

$
11,625,000
.....
2012


$
16,342,000
20,237,000
.....
2013
The 2012 appropriation includes $2,604,000 for 2011 and $9,021,000 for 2012.
The 2013 appropriation includes $5,008,000 for 2012 and $11,334,000 $15,229,000
for 2013.

    Sec. 20. Laws 2011, First Special Session chapter 11, article 4, section 10, subdivision
4, as amended by Laws 2012, chapter 292, article 2, section 21, is amended to read:
    Subd. 4. Alternative facilities bonding aid. For alternative facilities bonding aid,
according to Minnesota Statutes, section 123B.59, subdivision 1:

$
18,187,000
.....
2012


$
19,287,000
23,549,000
.....
2013
The 2012 appropriation includes $5,785,000 for 2011 and $12,402,000 for 2012.
The 2013 appropriation includes $6,885,000 for 2012 and $12,402,000 $16,664,000
for 2013.

    Sec. 21. Laws 2011, First Special Session chapter 11, article 4, section 10, subdivision
6, as amended by Laws 2012, chapter 292, article 2, section 22, is amended to read:
    Subd. 6. Deferred maintenance aid. For deferred maintenance aid, according to
Minnesota Statutes, section 123B.591, subdivision 4:

$
2,331,000
.....
2012


$
3,141,000
3,817,000
.....
2013
The 2012 appropriation includes $676,000 for 2011 and $1,655,000 for 2012.
The 2013 appropriation includes $918,000 for 2012 and $2,223,000 $2,899,000
for 2013.
E. NUTRITION AND LIBRARIES

    Sec. 22. Laws 2011, First Special Session chapter 11, article 5, section 12, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 23, is amended to read:
    Subd. 2. School lunch. For school lunch aid according to Minnesota Statutes,
section 124D.111, and Code of Federal Regulations, title 7, section 210.17:

$
12,285,000
.....
2012


$
12,524,000
12,266,000
.....
2013

    Sec. 23. Laws 2011, First Special Session chapter 11, article 5, section 12, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 24, is amended to read:
    Subd. 3. School breakfast. For traditional school breakfast aid under Minnesota
Statutes, section 124D.1158:

$
5,247,000
.....
2012


$
5,560,000
5,417,000
.....
2013

    Sec. 24. Laws 2011, First Special Session chapter 11, article 5, section 12, subdivision
4, as amended by Laws 2012, chapter 292, article 2, section 25, is amended to read:
    Subd. 4. Kindergarten milk. For kindergarten milk aid under Minnesota Statutes,
section 124D.118:

$
1,025,000
.....
2012


$
1,035,000
1,019,000
.....
2013

    Sec. 25. Laws 2011, First Special Session chapter 11, article 6, section 2, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 26, is amended to read:
    Subd. 2. Basic system support. For basic system support grants under Minnesota
Statutes, section 134.355:

$
12,797,000
.....
2012


$
13,570,000
16,569,000
.....
2013
The 2012 appropriation includes $4,071,000 for 2011 and $8,726,000 for 2012.
The 2013 appropriation includes $4,844,000 for 2012 and $8,726,000 $11,725,000
for 2013.

    Sec. 26. Laws 2011, First Special Session chapter 11, article 6, section 2, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 27, is amended to read:
    Subd. 3. Multicounty, multitype library systems. For grants under Minnesota
Statutes, sections 134.353 and 134.354, to multicounty, multitype library systems:

$
1,226,000
.....
2012


$
1,300,000
1,588,000
.....
2013
The 2012 appropriation includes $390,000 for 2011 and $836,000 for 2012.
The 2013 appropriation includes $464,000 for 2012 and $836,000 $1,124,000 for
2013.

    Sec. 27. Laws 2011, First Special Session chapter 11, article 6, section 2, subdivision
5, as amended by Laws 2012, chapter 292, article 2, section 28, is amended to read:
    Subd. 5. Regional library telecommunications aid. For regional library
telecommunications aid under Minnesota Statutes, section 134.355:

$
2,169,000
.....
2012


$
2,300,000
2,809,000
.....
2013
The 2012 appropriation includes $690,000 for 2011 and $1,479,000 for 2012.
The 2013 appropriation includes $821,000 for 2012 and $1,479,000 $1,988,000
for 2013.
F. EARLY CHILDHOOD EDUCATION, PREVENTION, AND
LIFELONG LEARNING

    Sec. 28. Laws 2011, First Special Session chapter 11, article 7, section 2, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 29, is amended to read:
    Subd. 2. School readiness. For revenue for school readiness programs under
Minnesota Statutes, sections 124D.15 and 124D.16:

$
9,444,000
.....
2012


$
10,095,000
12,326,000
.....
2013
The 2012 appropriation includes $2,952,000 for 2011 and $6,492,000 for 2012.
The 2013 appropriation includes $3,603,000 for 2012 and $6,492,000 $8,723,000
for 2013.

    Sec. 29. Laws 2011, First Special Session chapter 11, article 7, section 2, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 30, is amended to read:
    Subd. 3. Early childhood family education aid. For early childhood family
education aid under Minnesota Statutes, section 124D.135:

$
21,099,000
.....
2012


$
22,358,000
27,197,000
.....
2013
The 2012 appropriation includes $6,542,000 for 2011 and $14,557,000 for 2012.
The 2013 appropriation includes $8,082,000 for 2012 and $14,276,000 $19,115,000
for 2013.

    Sec. 30. Laws 2011, First Special Session chapter 11, article 7, section 2, subdivision
4, as amended by Laws 2012, chapter 292, article 2, section 31, is amended to read:
    Subd. 4. Health and developmental screening aid. For health and developmental
screening aid under Minnesota Statutes, sections 121A.17 and 121A.19:

$
3,359,000
.....
2012


$
3,543,000
4,287,000
.....
2013
The 2012 appropriation includes $1,066,000 for 2011 and $2,293,000 for 2012.
The 2013 appropriation includes $1,273,000 for 2012 and $2,270,000 $3,014,000
for 2013.

    Sec. 31. Laws 2011, First Special Session chapter 11, article 8, section 2, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 32, is amended to read:
    Subd. 2. Community education aid. For community education aid under
Minnesota Statutes, section 124D.20:

$
442,000
.....
2012


$
746,000
926,000
.....
2013
The 2012 appropriation includes $134,000 for 2011 and $308,000 for 2012.
The 2013 appropriation includes $170,000 for 2012 and $576,000 $756,000 for 2013.

    Sec. 32. Laws 2011, First Special Session chapter 11, article 8, section 2, subdivision
3, as amended by Laws 2012, chapter 292, article 2, section 33, is amended to read:
    Subd. 3. Adults with disabilities program aid. For adults with disabilities
programs under Minnesota Statutes, section 124D.56:

$
654,000
.....
2012


$
710,000
867,000
.....
2013
The 2012 appropriation includes $197,000 for 2011 and $457,000 for 2012.
The 2013 appropriation includes $253,000 for 2012 and $457,000 $614,000 for 2013.

    Sec. 33. Laws 2011, First Special Session chapter 11, article 9, section 3, subdivision
2, as amended by Laws 2012, chapter 292, article 2, section 34, is amended to read:
    Subd. 2. Adult basic education aid. For adult basic education aid under Minnesota
Statutes, section 124D.531:

$
42,526,000
.....
2012


$
45,901,000
56,113,000
.....
2013
The 2012 appropriation includes $13,364,000 for 2011 and $29,162,000 for 2012.
The 2013 appropriation includes $16,190,000 for 2012 and $29,711,000 $39,923,000
for 2013.
Presented to the governor May 22, 2013
Signed by the governor May 22, 2013, 10:34 a.m.

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