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                            CHAPTER 272-H.F.No. 2867 
                  An act relating to state government; appropriating 
                  money for prekindergarten through grade 12 education, 
                  including general education, education excellence, 
                  special programs, and facilities and technology; early 
                  childhood and family education, including early 
                  childhood family support, prevention, and 
                  self-sufficiency and lifelong learning; libraries; and 
                  health and human services; setting priorities for use 
                  of additional revenues; modifying certain bonding, 
                  loan, and financial provisions of the public 
                  facilities authority; amending Minnesota Statutes 
                  2002, sections 446A.12, subdivision 1; 446A.14; 
                  446A.17; 446A.19; Minnesota Statutes 2003 Supplement, 
                  sections 16A.152, subdivision 2; 123B.54; Laws 2003, 
                  First Special Session chapter 9, article 1, section 
                  53, subdivisions 2, 3, 5, 6, 11, 12; Laws 2003, First 
                  Special Session chapter 9, article 2, section 55, 
                  subdivisions 2, 3, 4, 5, 7, 9, 12; Laws 2003, First 
                  Special Session chapter 9, article 3, section 20, 
                  subdivisions 4, 5, 6, 7, 8, 9; Laws 2003, First 
                  Special Session chapter 9, article 4, section 31, 
                  subdivisions 2, 3; Laws 2003, First Special Session 
                  chapter 9, article 5, section 35, subdivisions 2, 3; 
                  Laws 2003, First Special Session chapter 9, article 6, 
                  section 4; Laws 2003, First Special Session chapter 9, 
                  article 7, section 11, subdivision 3; Laws 2003, First 
                  Special Session chapter 9, article 8, section 7, 
                  subdivisions 2, 5; Laws 2003, First Special Session 
                  chapter 9, article 9, section 9, subdivision 2; Laws 
                  2003, First Special Session chapter 14, article 13C, 
                  sections 1; 2, subdivisions 1, 3, 6, 7, 9, 11; 10, 
                  subdivisions 1, 2. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                   ARTICLE 1
                   PREKINDERGARTEN THROUGH GRADE 12 EDUCATION
                             A.  GENERAL EDUCATION
           Section 1.  Laws 2003, First Special Session chapter 9, 
        article 1, section 53, subdivision 2, is amended to read: 
           Subd. 2.  [GENERAL EDUCATION AID.] For general education 
        aid under Minnesota Statutes, section 126C.13, subdivision 4: 
             $4,764,384,000 $4,726,466,000     .....     2004
             $5,090,303,000 $5,026,983,000     .....     2005
           The 2004 appropriation includes $857,432,000 $860,552,000 
        for 2003 and $3,906,952,000 $3,865,914,000 for 2004. 
           The 2005 appropriation includes 
        $1,009,856,000 $1,009,822,000 for 2004 
        and $4,080,447,000 $4,017,161,000 for 2005.  
           Sec. 2.  Laws 2003, First Special Session chapter 9, 
        article 1, section 53, subdivision 3, is amended to read: 
           Subd. 3.  [REFERENDUM TAX BASE REPLACEMENT AID.] For 
        referendum tax base replacement aid under Minnesota Statutes, 
        section 126C.17, subdivision 7a: 
             $ 7,841,000 $8,096,000     .....     2004 
             $ 8,543,000 $8,596,000     .....     2005 
           The 2004 appropriation includes $1,419,000 for 2003 and 
        $6,422,000 $6,677,000 for 2004.  
           The 2005 appropriation includes $1,605,000 $1,669,000 for 
        2004 and $6,938,000 $6,927,000 for 2005. 
           Sec. 3.  Laws 2003, First Special Session chapter 9, 
        article 1, section 53, subdivision 5, is amended to read: 
           Subd. 5.  [ABATEMENT REVENUE.] For abatement aid under 
        Minnesota Statutes, section 127A.49:  
             $2,680,000 $2,436,000     .....     2004 
             $2,937,000 $1,559,000     .....     2005 
           The 2004 appropriation includes $472,000 for 2003 and 
        $2,208,000 $1,964,000 for 2004.  
           The 2005 appropriation includes $551,000 $491,000 for 2004 
        and $2,386,000 $1,068,000 for 2005.  
           Sec. 4.  Laws 2003, First Special Session chapter 9, 
        article 1, section 53, subdivision 6, is amended to read: 
           Subd. 6.  [CONSOLIDATION TRANSITION.] For districts 
        consolidating under Minnesota Statutes, section 123A.485: 
             $207,000 $ 35,000     .....     2004 
             $607,000 $145,000     .....     2005 
           The 2004 appropriation includes $35,000 for 2003 and 
        $172,000 $0 for 2004. 
           The 2005 appropriation includes $42,000 $0 for 2004 and 
        $565,000 $145,000 for 2005. 
           Sec. 5.  Laws 2003, First Special Session chapter 9, 
        article 1, section 53, subdivision 11, is amended to read: 
           Subd. 11.  [NONPUBLIC PUPIL AID.] For nonpublic pupil 
        education aid under Minnesota Statutes, sections 123B.40 to 
        123B.43 and 123B.87: 
             $14,626,000 $14,411,000     .....     2004 
             $15,594,000 $15,072,000     .....     2005 
           The 2004 appropriation includes $2,715,000 for 2003 and 
        $11,911,000 $11,696,000 for 2004. 
           The 2005 appropriation includes $2,977,000 $2,923,000 for 
        2004 and $12,617,000 $12,149,000 for 2005. 
           Sec. 6.  Laws 2003, First Special Session chapter 9, 
        article 1, section 53, subdivision 12, is amended to read: 
           Subd. 12.  [NONPUBLIC PUPIL TRANSPORTATION.] For nonpublic 
        pupil transportation aid under Minnesota Statutes, section 
        123B.92, subdivision 9: 
             $21,477,000 $20,471,000     .....     2004 
             $21,982,000 $21,421,000     .....     2005 
           The 2004 appropriation includes $3,990,000 for 2003 and 
        $17,487,000 $16,481,000 for 2004. 
           The 2005 appropriation includes $4,371,000 $4,120,000 for 
        2004 and $17,611,000 $17,301,000 for 2005. 
                            B.  EDUCATION EXCELLENCE
           Sec. 7.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 2, is amended to read: 
           Subd. 2.  [CHARTER SCHOOL BUILDING LEASE AID.] For building 
        lease aid under Minnesota Statutes, section 124D.11, subdivision 
        4: 
             $17,140,000 $16,753,000     .....     2004 
             $21,018,000 $21,347,000     .....     2005 
           The 2004 appropriation includes $2,524,000 for 2003 and 
        $14,616,000 $14,229,000 for 2004. 
           The 2005 appropriation includes $3,654,000 $3,557,000 for 
        2004 and $17,364,000 $17,790,000 for 2005.  
           Sec. 8.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 3, is amended to read: 
           Subd. 3.  [CHARTER SCHOOL STARTUP AID.] For charter school 
        startup cost aid under Minnesota Statutes, section 124D.11: 
             $824,000 $844,000     .....     2004 
             $151,000 $156,000     .....     2005 
           The 2004 appropriation includes $220,000 for 2003 and 
        $604,000 $624,000 for 2004.  
           The 2005 appropriation includes $151,000 $156,000 for 2004 
        and $0 for 2005. 
           Sec. 9.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 4, is amended to read: 
           Subd. 4.  [CHARTER SCHOOL INTEGRATION GRANTS.] For grants 
        to charter schools to promote integration and desegregation 
        under Minnesota Statutes, section 124D.11, subdivision 6, 
        paragraph (e): 
             $8,000 $7,000     .....     2004 
           This appropriation includes $8,000 $7,000 for 2003 and $0 
        for 2004. 
           Sec. 10.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 5, is amended to read: 
           Subd. 5.  [INTEGRATION AID.] For integration aid under 
        Minnesota Statutes, section 124D.86, subdivision 5: 
             $56,869,000 $55,911,000     .....     2004 
             $56,092,000 $55,893,000     .....     2005 
           The 2004 appropriation includes $8,428,000 for 2003 and 
        $48,441,000 $47,483,000 for 2004. 
           The 2005 appropriation includes $12,110,000 $11,870,000 for 
        2004 and $43,982,000 $44,023,000 for 2005.  
           Sec. 11.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 7, is amended to read: 
           Subd. 7.  [MAGNET SCHOOL STARTUP AID.] For magnet school 
        startup aid under Minnesota Statutes, section 124D.88: 
             $ 37,000     .....     2004 
             $454,000 $ 40,000     .....     2005 
           The 2004 appropriation includes $37,000 for 2003 and $0 for 
        2004.  
           The 2005 appropriation includes $0 for 2004 and $437,000 
        $40,000 for 2005. 
           Sec. 12.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 9, is amended to read: 
           Subd. 9.  [SUCCESS FOR THE FUTURE.] For American Indian 
        success for the future grants under Minnesota Statutes, section 
        124D.81: 
             $2,073,000 $2,061,000     .....     2004
             $2,137,000     .....     2005
           The 2004 appropriation includes $363,000 $351,000 for 2003 
        and $1,710,000 for 2004. 
           The 2005 appropriation includes $427,000 for 2004 and 
        $1,710,000 for 2005. 
           Sec. 13.  Laws 2003, First Special Session chapter 9, 
        article 2, section 55, subdivision 12, is amended to read:  
           Subd. 12.  [TRIBAL CONTRACT SCHOOLS.] For tribal contract 
        school aid under Minnesota Statutes, section 124D.83: 
             $2,135,000 $1,617,000     .....     2004
             $2,336,000 $2,185,000     .....     2005
           The 2004 appropriation includes $285,000 for 2003 and 
        $1,850,000 $1,332,000 for 2004. 
           The 2005 appropriation includes $462,000 $333,000 for 2004 
        and $1,874,000 $1,852,000 for 2005. 
                              C.  SPECIAL PROGRAMS
           Sec. 14.  Laws 2003, First Special Session chapter 9, 
        article 3, section 20, subdivision 4, is amended to read: 
           Subd. 4.  [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: 
             $2,177,000 $2,311,000     .....     2004 
             $2,244,000 $2,550,000     .....     2005 
           If the appropriation for either year is insufficient, the 
        appropriation for the other year is available.  
           Sec. 15.  Laws 2003, First Special Session chapter 9, 
        article 3, section 20, subdivision 5, is amended to read: 
           Subd. 5.  [TRAVEL FOR HOME-BASED SERVICES.] For aid for 
        teacher travel for home-based services under Minnesota Statutes, 
        section 125A.75, subdivision 1: 
             $220,000 $173,000     .....     2004 
             $261,000 $178,000     .....     2005 
           The 2004 appropriation includes $34,000 for 2003 and 
        $186,000 $139,000 for 2004. 
           The 2005 appropriation includes $46,000 $34,000 for 2004 
        and $215,000 $144,000 for 2005. 
           Sec. 16.  Laws 2003, First Special Session chapter 9, 
        article 3, section 20, subdivision 6, is amended to read: 
           Subd. 6.  [SPECIAL EDUCATION; EXCESS COSTS.] For excess 
        cost aid under Minnesota Statutes, section 125A.79, subdivision 
        7: 
             $92,606,000 $92,605,000     .....     2004 
             $92,984,000 $92,799,000     .....     2005 
           The 2004 appropriation includes $41,754,000 for 2003 and 
        $50,852,000 $50,851,000 for 2004. 
           The 2005 appropriation includes $41,215,000 $41,216,000 for 
        2004 and $51,769,000 $51,583,000 for 2005.  
           Sec. 17.  Laws 2003, First Special Session chapter 9, 
        article 3, section 20, subdivision 7, is amended to read: 
           Subd. 7.  [LITIGATION COSTS FOR SPECIAL EDUCATION.] For 
        paying the costs a district incurs under Minnesota Statutes, 
        section 125A.75, subdivision 8: 
             $346,000 $201,000     .....     2004 
             $ 17,000 $150,000     .....     2005 
           Sec. 18.  Laws 2003, First Special Session chapter 9, 
        article 3, section 20, subdivision 8, is amended to read: 
           Subd. 8.  [TRANSITION FOR DISABLED STUDENTS.] For aid for 
        transition programs for children with disabilities under 
        Minnesota Statutes, section 124D.454: 
             $8,625,000 $8,570,000     .....     2004 
             $8,867,000 $8,760,000     .....     2005 
           The 2004 appropriation includes $1,516,000 for 2003 and 
        $7,109,000 $7,054,000 for 2004.  
           The 2005 appropriation includes $1,777,000 $1,763,000 for 
        2004 and $7,090,000 $6,997,000 for 2005.  
           Sec. 19.  Laws 2003, First Special Session chapter 9, 
        article 3, section 20, subdivision 9, is amended to read: 
           Subd. 9.  [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: 
             $152,000 $36,000     .....     2004 
             $160,000 $61,000     .....     2005 
                         D.  FACILITIES AND TECHNOLOGY
           Sec. 20.  Minnesota Statutes 2003 Supplement, section 
        123B.54, is amended to read: 
           123B.54 [DEBT SERVICE APPROPRIATION.] 
           (a) $25,987,000 $28,367,000 in fiscal year 2002, 
        $29,941,000 2006 and $25,560,000 in fiscal year 2003, 
        $40,075,000 in fiscal year 2004, and $39,774,000 in fiscal years 
        2005 2007 and later are 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. 21.  Laws 2003, First Special Session chapter 9, 
        article 4, section 31, subdivision 2, is amended to read: 
           Subd. 2.  [HEALTH AND SAFETY REVENUE.] For health and 
        safety aid according to Minnesota Statutes, section 123B.57, 
        subdivision 5: 
             $7,839,000 $5,356,000     .....     2004 
             $6,068,000 $1,920,000     .....     2005 
           The 2004 appropriation includes $1,516,000 for 2003 and 
        $6,323,000 $3,840,000 for 2004. 
           The 2005 appropriation includes $1,580,000 $960,000 for 
        2004 and $4,488,000 $960,000 for 2005. 
           Sec. 22.  Laws 2003, First Special Session chapter 9, 
        article 4, section 31, subdivision 3, is amended to read: 
           Subd. 3.  [DEBT SERVICE EQUALIZATION.] For debt service aid 
        according to Minnesota Statutes, section 123B.53, subdivision 6: 
             $34,500,000 $35,598,000     .....     2004 
             $37,575,000 $31,220,000     .....     2005 
           The 2004 appropriation includes $5,586,000 for 2003 and 
        $28,914,000 $30,012,000 for 2004. 
           The 2005 appropriation includes $7,228,000 $7,503,000 for 
        2004 and $30,347,000 $23,717,000 for 2005. 
                E.  NUTRITION, SCHOOL ACCOUNTING, OTHER PROGRAMS
           Sec. 23.  Laws 2003, First Special Session chapter 9, 
        article 5, section 35, subdivision 2, is amended to read: 
           Subd. 2.  [SCHOOL LUNCH.] (a) For school lunch aid 
        according to Minnesota Statutes, section 124D.111, and Code of 
        Federal Regulations, title 7, section 210.17:  
             $7,800,000 $7,650,000     .....     2004 
             $7,950,000 $7,760,000     .....     2005 
           Sec. 24.  Laws 2003, First Special Session chapter 9, 
        article 5, section 35, subdivision 3, is amended to read: 
           Subd. 3.  [TRADITIONAL SCHOOL BREAKFAST; KINDERGARTEN 
        MILK.] For traditional school breakfast aid and kindergarten 
        milk under Minnesota Statutes, sections 124D.1158 and 124D.118: 
             $3,088,000 $4,382,000     .....     2004 
             $3,217,000 $4,460,000     .....     2005 
                                 F.  LIBRARIES
           Sec. 25.  Laws 2003, First Special Session chapter 9, 
        article 6, section 4, is amended to read: 
           Sec. 4.  [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.  [BASIC SYSTEM SUPPORT.] For basic system support 
        grants under Minnesota Statutes, section 134.355: 
             $8,072,000 $8,312,000     .....     2004 
             $8,570,000     .....     2005 
           The 2004 appropriation includes $1,456,000 for 2003 and 
        $6,616,000 $6,856,000 for 2004. 
           The 2005 appropriation includes $1,654,000 $1,714,000 for 
        2004 and $6,916,000 $6,856,000 for 2005. 
           Subd. 3.  [REGIONAL LIBRARY TELECOMMUNICATIONS AID.] For 
        regional library telecommunications aid under Minnesota 
        Statutes, section 134.355: 
             $1,200,000 $960,000     .....     2004
             $1,200,000     .....     2005
           The 2004 appropriation includes $960,000 for 2004. 
           The 2005 appropriation includes $240,000 for 2004 and 
        $960,000 for 2005. 
           Subd. 4.  [MULTICOUNTY, MULTITYPE LIBRARY SYSTEMS.] For 
        grants according to Minnesota Statutes, sections 134.353 and 
        134.354, to multicounty, multitype library systems: 
             $876,000       .....     2004 
             $903,000       .....     2005 
           The 2004 appropriation includes $153,000 for 2003 and 
        $723,000 for 2004. 
           The 2005 appropriation includes $180,000 for 2004 and 
        $723,000 for 2005.  
           Subd. 5.  [ELECTRONIC LIBRARY FOR MINNESOTA.] For statewide 
        licenses to on-line databases selected in cooperation with the 
        higher education services office for school media centers, 
        public libraries, state government agency libraries, and public 
        or private college or university libraries: 
              $400,000     .....     2004 
              $400,000     .....     2005 
           Any balance in the first year does not cancel but is 
        available in the second year. 
                       G.  EARLY CHILDHOOD FAMILY SUPPORT
           Sec. 26.  Laws 2003, First Special Session chapter 9, 
        article 7, section 11, subdivision 3, is amended to read: 
           Subd. 3.  [EARLY CHILDHOOD FAMILY EDUCATION AID.] For early 
        childhood family education aid under Minnesota Statutes, section 
        124D.135: 
             $19,675,000 $19,079,000     .....     2004 
             $15,129,000 $14,407,000     .....     2005 
           The 2004 appropriation includes $3,239,000 for 2003 and 
        $16,436,000 $15,840,000 for 2004.  
           The 2005 appropriation includes $4,109,000 $3,959,000 for 
        2004 and $11,020,000 $10,448,000 for 2005.  
                                 H.  PREVENTION
           Sec. 27.  Laws 2003, First Special Session chapter 9, 
        article 8, section 7, subdivision 2, is amended to read: 
           Subd. 2.  [COMMUNITY EDUCATION AID.] For community 
        education aid under Minnesota Statutes, section 124D.20: 
             $5,495,000 $5,351,000     .....     2004 
             $3,406,000 $3,137,000     .....     2005 
           The 2004 appropriation includes $956,000 for 2003 and 
        $4,539,000 $4,395,000 for 2004.  
           The 2005 appropriation includes $1,134,000 $1,098,000 for 
        2004 and $2,272,000 $2,039,000 for 2005.  
           Sec. 28.  Laws 2003, First Special Session chapter 9, 
        article 8, section 7, subdivision 5, is amended to read: 
           Subd. 5.  [SCHOOL-AGE CARE REVENUE.] For extended day care 
        aid under Minnesota Statutes, section 124D.22: 
             $41,000 $40,000     .....     2004 
             $22,000 $24,000     .....     2005
           The 2004 appropriation includes $14,000 for 2003 and 
        $27,000 $26,000 for 2004. 
           The 2005 appropriation includes $6,000 for 2004 and $16,000 
        $18,000 for 2005. 
                   I.  SELF-SUFFICIENCY AND LIFELONG LEARNING
           Sec. 29.  Laws 2003, First Special Session chapter 9, 
        article 9, section 9, subdivision 2, is amended to read: 
           Subd. 2.  [ADULT BASIC EDUCATION AID.] For adult basic 
        education aid under Minnesota Statutes, section 124D.52, in 
        fiscal year 2004 and Minnesota Statutes, section 124D.531, in 
        fiscal year 2005:  
             $33,153,000 $33,014,000     .....     2004 
             $35,823,000 $35,808,000     .....     2005 
           The 2004 appropriation includes $5,905,000 $5,827,000 for 
        2003 and $27,248,000 $27,187,000 for 2004.  
           The 2005 appropriation includes $6,811,000 $6,796,000 for 
        2004 and $29,012,000 for 2005.  
           Sec. 30.  [EFFECTIVE DATE.] 
           Sections 1 to 29 are effective the day following final 
        enactment. 

                                   ARTICLE 2
               A.  HEALTH AND HUMAN SERVICES FORECAST ADJUSTMENTS
           Section 1.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 1, is amended to read: 
        Section 1.  [HEALTH AND HUMAN SERVICES APPROPRIATIONS FORECAST 
        ADJUSTMENTS.] 
           The sums shown in the columns marked "APPROPRIATIONS" are 
        appropriated from the general fund, or any other fund named, to 
        the agencies and for the purposes specified in the sections of 
        this article, to be available for the fiscal years indicated for 
        each purpose.  The figures "2004" and "2005" where used in this 
        article, mean that the appropriation or appropriations listed 
        under them are available for the fiscal year ending June 30, 
        2004, or June 30, 2005, respectively.  Where a dollar amount 
        appears in parentheses, it means a reduction of an appropriation.
                                SUMMARY BY FUND
                                                             BIENNIAL
                                   2004          2005           TOTAL
        General            $3,765,212,000 $3,727,319,000 $7,492,531,000
                           $3,500,860,000 $3,746,520,000 $7,247,380,000
        State Government
        Special Revenue        45,337,000     45,104,000     90,441,000
        Health Care 
        Access                294,090,000    308,525,000    602,615,000
                              280,060,000    308,609,000    588,669,000
        Federal TANF          261,552,000    270,364,000    531,916,000
                              276,425,000    276,363,000    552,788,000
        Lottery Prize 
        Fund                    1,556,000      1,556,000      3,112,000
        Special Revenue         3,340,000      3,340,000      6,680,000
        TOTAL              $4,371,087,000 $4,356,208,000 $8,727,295,000
                           $4,107,578,000 $4,381,492,000 $8,489,070,000
                                                   APPROPRIATIONS 
                                               Available for the Year 
                                                   Ending June 30 
                                                  2004         2005 
           Sec. 2.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 2, subdivision 1, is amended to read: 
        Subdivision 1.  Total
        Appropriation                     $4,111,558,000 $4,110,496,000
                                          $3,848,049,000 $4,135,780,000
                      Summary by Fund
        General           3,566,163,000 3,541,854,000
                          3,301,811,000 3,561,055,000
        State Government 
        Special Revenue         534,000       534,000
        Health Care
        Access              287,753,000   302,188,000
                            273,723,000   302,272,000
        Federal TANF        255,552,000   264,364,000
                            270,425,000   270,363,000
        Lottery Cash
        Flow                  1,556,000     1,556,000
        [FEDERAL CONTINGENCY APPROPRIATION.] 
        (a) Any additional Federal Medicaid 
        funds made available under title IV of 
        the federal Jobs and Growth Tax Relief 
        Reconciliation Act of 2003 are 
        appropriated to the commissioner of 
        human services for use in the state's 
        medical assistance and MinnesotaCare 
        programs.  The commissioners of human 
        services and finance shall report to 
        the legislative advisory committee on 
        the additional federal Medicaid 
        matching funds that will be available 
        to the state. 
        (b) Contingent upon Because of the 
        availability of these funds, the 
        following policies shall become 
        effective and necessary funds are 
        appropriated for those purposes: 
        (1) medical assistance and 
        MinnesotaCare eligibility and local 
        financial participation changes 
        provided for in this act may be 
        implemented prior to September 2, 2003, 
        or may be delayed as necessary to 
        maximize the use of federal funds 
        received under title IV of the Jobs and 
        Growth Tax Relief Reconciliation Act of 
        2003; 
        (2) the aggregate cap on the services 
        identified in Minnesota Statutes, 
        section 256L.035, paragraph (a), clause 
        (3), shall be increased from $2,000 to 
        $5,000.  This increase shall expire at 
        the end of fiscal year 2007.  Funds may 
        be transferred from the general fund to 
        the health care access fund as 
        necessary to implement this provision; 
        and 
        (3) the following payment shifts shall 
        not be implemented: 
        (i) MFIP payment shift found in 
        subdivision 11; 
        (ii) the county payment shift found in 
        subdivision 1; and 
        (iii) the delay in medical assistance 
        and general assistance medical care 
        fee-for-service payments found in 
        subdivision 6. 
        (c) Notwithstanding section 14, 
        paragraphs (a) and (b) shall expire 
        June 30, 2007. 
        [RECEIPTS FOR SYSTEMS PROJECTS.] 
        Appropriations and federal receipts for 
        information system projects for MAXIS, 
        PRISM, MMIS, and SSIS must be deposited 
        in the state system account authorized 
        in Minnesota Statutes, section 
        256.014.  Money appropriated for 
        computer projects approved by the 
        Minnesota office of technology, funded 
        by the legislature, and approved by the 
        commissioner of finance may be 
        transferred from one project to another 
        and from development to operations as 
        the commissioner of human services 
        considers necessary.  Any unexpended 
        balance in the appropriation for these 
        projects does not cancel but is 
        available for ongoing development and 
        operations. 
        [GIFTS.] Notwithstanding Minnesota 
        Statutes, chapter 7, the commissioner 
        may accept on behalf of the state 
        additional funding from sources other 
        than state funds for the purpose of 
        financing the cost of assistance 
        program grants or nongrant 
        administration.  All additional funding 
        is appropriated to the commissioner for 
        use as designated by the grantor of 
        funding. 
        [SYSTEMS CONTINUITY.] In the event of 
        disruption of technical systems or 
        computer operations, the commissioner 
        may use available grant appropriations 
        to ensure continuity of payments for 
        maintaining the health, safety, and 
        well-being of clients served by 
        programs administered by the department 
        of human services.  Grant funds must be 
        used in a manner consistent with the 
        original intent of the appropriation. 
        [NONFEDERAL SHARE TRANSFERS.] The 
        nonfederal share of activities for 
        which federal administrative 
        reimbursement is appropriated to the 
        commissioner may be transferred to the 
        special revenue fund. 
        [TANF FUNDS APPROPRIATED TO OTHER 
        ENTITIES.] Any expenditures from the 
        TANF block grant shall be expended in 
        accordance with the requirements and 
        limitations of part A of title IV of 
        the Social Security Act, as amended, 
        and any other applicable federal 
        requirement or limitation.  Prior to 
        any expenditure of these funds, the 
        commissioner shall assure that funds 
        are expended in compliance with the 
        requirements and limitations of federal 
        law and that any reporting requirements 
        of federal law are met.  It shall be 
        the responsibility of any entity to 
        which these funds are appropriated to 
        implement a memorandum of understanding 
        with the commissioner that provides the 
        necessary assurance of compliance prior 
        to any expenditure of funds.  The 
        commissioner shall receipt TANF funds 
        appropriated to other state agencies 
        and coordinate all related interagency 
        accounting transactions necessary to 
        implement these appropriations.  
        Unexpended TANF funds appropriated to 
        any state, local, or nonprofit entity 
        cancel at the end of the state fiscal 
        year unless appropriating language 
        permits otherwise. 
        [TANF FUNDS TRANSFERRED TO OTHER 
        FEDERAL GRANTS.] The commissioner must 
        authorize transfers from TANF to other 
        federal block grants so that funds are 
        available to meet the annual 
        expenditure needs as appropriated.  
        Transfers may be authorized prior to 
        the expenditure year with the agreement 
        of the receiving entity.  Transferred 
        funds must be expended in the year for 
        which the funds were appropriated 
        unless appropriation language permits 
        otherwise.  In accelerating transfer 
        authorizations, the commissioner must 
        aim to preserve the future potential 
        transfer capacity from TANF to other 
        block grants. 
        [TANF MAINTENANCE OF EFFORT.] (a) In 
        order to meet the basic maintenance of 
        effort (MOE) requirements of the TANF 
        block grant specified under Code of 
        Federal Regulations, title 45, section 
        263.1, the commissioner may only report 
        nonfederal money expended for allowable 
        activities listed in the following 
        clauses as TANF/MOE expenditures: 
        (1) MFIP cash, diversionary work 
        program, and food assistance benefits 
        under Minnesota Statutes, chapter 256J; 
        (2) the child care assistance programs 
        under Minnesota Statutes, sections 
        119B.03 and 119B.05, and county child 
        care administrative costs under 
        Minnesota Statutes, section 119B.15; 
        (3) state and county MFIP 
        administrative costs under Minnesota 
        Statutes, chapters 256J and 256K; 
        (4) state, county, and tribal MFIP 
        employment services under Minnesota 
        Statutes, chapters 256J and 256K; 
        (5) expenditures made on behalf of 
        noncitizen MFIP recipients who qualify 
        for the medical assistance without 
        federal financial participation program 
        under Minnesota Statutes, section 
        256B.06, subdivision 4, paragraphs (d), 
        (e), and (j); and 
        (6) qualifying working family credit 
        expenditures under Minnesota Statutes, 
        section 290.0671. 
        (b) The commissioner shall ensure that 
        sufficient qualified nonfederal 
        expenditures are made each year to meet 
        the state's TANF/MOE requirements.  For 
        the activities listed in paragraph (a), 
        clauses (2) to (6), the commissioner 
        may only report expenditures that are 
        excluded from the definition of 
        assistance under Code of Federal 
        Regulations, title 45, section 260.31. 
        (c) By August 31 of each year, the 
        commissioner shall make a preliminary 
        calculation to determine the likelihood 
        that the state will meet its annual 
        federal work participation requirement 
        under Code of Federal Regulations, 
        title 45, sections 261.21 and 261.23, 
        after adjustment for any caseload 
        reduction credit under Code of Federal 
        Regulations, title 45, section 261.41.  
        If the commissioner determines that the 
        state will meet its federal work 
        participation rate for the federal 
        fiscal year ending that September, the 
        commissioner may reduce the expenditure 
        under paragraph (a), clause (1), to the 
        extent allowed under Code of Federal 
        Regulations, title 45, section 
        263.1(a)(2). 
        (d) For fiscal years beginning with 
        state fiscal year 2003, the 
        commissioner shall assure that the 
        maintenance of effort used by the 
        commissioner of finance for the 
        February and November forecasts 
        required under Minnesota Statutes, 
        section 16A.103, contains expenditures 
        under paragraph (a), clause (1), equal 
        to at least 25 percent of the total 
        required under Code of Federal 
        Regulations, title 45, section 263.1. 
        (e) If nonfederal expenditures for the 
        programs and purposes listed in 
        paragraph (a) are insufficient to meet 
        the state's TANF/MOE requirements, the 
        commissioner shall recommend additional 
        allowable sources of nonfederal 
        expenditures to the legislature, if the 
        legislature is or will be in session to 
        take action to specify additional 
        sources of nonfederal expenditures for 
        TANF/MOE before a federal penalty is 
        imposed.  The commissioner shall 
        otherwise provide notice to the 
        legislative commission on planning and 
        fiscal policy under paragraph (g). 
        (f) If the commissioner uses authority 
        granted under section 11, or similar 
        authority granted by a subsequent 
        legislature, to meet the state's 
        TANF/MOE requirement in a reporting 
        period, the commissioner shall inform 
        the chairs of the appropriate 
        legislative committees about all 
        transfers made under that authority for 
        this purpose. 
        (g) If the commissioner determines that 
        nonfederal expenditures under paragraph 
        (a) are insufficient to meet TANF/MOE 
        expenditure requirements, and if the 
        legislature is not or will not be in 
        session to take timely action to avoid 
        a federal penalty, the commissioner may 
        report nonfederal expenditures from 
        other allowable sources as TANF/MOE 
        expenditures after the requirements of 
        this paragraph are met.  The 
        commissioner may report nonfederal 
        expenditures in addition to those 
        specified under paragraph (a) as 
        nonfederal TANF/MOE expenditures, but 
        only ten days after the commissioner of 
        finance has first submitted the 
        commissioner's recommendations for 
        additional allowable sources of 
        nonfederal TANF/MOE expenditures to the 
        members of the legislative commission 
        on planning and fiscal policy for their 
        review. 
        (h) The commissioner of finance shall 
        not incorporate any changes in federal 
        TANF expenditures or nonfederal 
        expenditures for TANF/MOE that may 
        result from reporting additional 
        allowable sources of nonfederal 
        TANF/MOE expenditures under the interim 
        procedures in paragraph (g) into the 
        February or November forecasts required 
        under Minnesota Statutes, section 
        16A.103, unless the commissioner of 
        finance has approved the additional 
        sources of expenditures under paragraph 
        (g). 
        (i) Minnesota Statutes, section 
        256.011, subdivision 3, which requires 
        that federal grants or aids secured or 
        obtained under that subdivision be used 
        to reduce any direct appropriations 
        provided by law, do not apply if the 
        grants or aids are federal TANF funds. 
        (j) Notwithstanding section 14, 
        paragraph (a), clauses (1) to (6), and 
        paragraphs (b) to (j) expire June 30, 
        2007. 
        [WORKING FAMILY CREDIT EXPENDITURES AS 
        TANF MOE.] The commissioner may claim 
        as TANF maintenance of effort up to the 
        following amounts of working family 
        credit expenditures for the following 
        fiscal years: 
        (1) fiscal year 2004, $7,013,000; 
        (2) fiscal year 2005, $25,133,000; 
        (3) fiscal year 2006, $6,942,000; and 
        (4) fiscal year 2007, $6,707,000. 
        [FISCAL YEAR 2003 APPROPRIATIONS 
        CARRYFORWARD.] Effective the day 
        following final enactment, 
        notwithstanding Minnesota Statutes, 
        section 16A.28, or any other law to the 
        contrary, state agencies and 
        constitutional offices may carry 
        forward unexpended and unencumbered 
        nongrant operating balances from fiscal 
        year 2003 general fund appropriations 
        into fiscal year 2004 to offset general 
        budget reductions. 
        [TRANSFER OF GRANT BALANCES.] Effective 
        the day following final enactment, the 
        commissioner of human services, with 
        the approval of the commissioner of 
        finance and after notification of the 
        chair of the senate health, human 
        services and corrections budget 
        division and the chair of the house of 
        representatives health and human 
        services finance committee, may 
        transfer unencumbered appropriation 
        balances for the biennium ending June 
        30, 2003, in fiscal year 2003 among the 
        MFIP, MFIP child care assistance under 
        Minnesota Statutes, section 119B.05, 
        general assistance, general assistance 
        medical care, medical assistance, 
        Minnesota supplemental aid, and group 
        residential housing programs, and the 
        entitlement portion of the chemical 
        dependency consolidated treatment fund, 
        and between fiscal years of the 
        biennium. 
        [TANF APPROPRIATION CANCELLATION.] 
        Notwithstanding the provisions of Laws 
        2000, chapter 488, article 1, section 
        16, any prior appropriations of TANF 
        funds to the department of trade and 
        economic development or to the job 
        skills partnership board or any 
        transfers of TANF funds from another 
        agency to the department of trade and 
        economic development or to the job 
        skills partnership board are not 
        available until expended, and if 
        unobligated as of June 30, 2003, these 
        appropriations or transfers shall 
        cancel to the TANF fund. 
        [SHIFT COUNTY PAYMENT.] The 
        commissioner shall make up to 100 
        percent of the calendar year 2005 
        payments to counties for developmental 
        disabilities semi-independent living 
        services grants, developmental 
        disabilities family support grants, and 
        adult mental health grants from fiscal 
        year 2006 appropriations.  This is a 
        onetime payment shift.  Calendar year 
        2006 and future payments for these 
        grants are not affected by this shift.  
        This provision expires June 30, 2006. 
        [CAPITATION RATE INCREASE.] Of the 
        health care access fund appropriations 
        to the University of Minnesota in the 
        higher education omnibus appropriation 
        bill, $2,157,000 in fiscal year 2004 
        and $2,157,000 in fiscal year 2005 are 
        to be used to increase the capitation 
        payments under Minnesota Statutes, 
        section 256B.69.  Notwithstanding the 
        provisions of section 14, this 
        provision shall not expire. 
           Sec. 3.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 2, subdivision 3, is amended to read: 
        Subd. 3.  Revenue and Pass-Through 
        Federal TANF         55,855,000    53,315,000
                             56,643,000    57,275,000
        [TANF TRANSFER TO SOCIAL SERVICES BLOCK 
        GRANT.] $3,137,000 in fiscal year 2005 
        is appropriated to the commissioner for 
        the purposes of providing services for 
        families with children whose incomes 
        are at or below 200 percent of the 
        federal poverty guidelines.  The 
        commissioner shall authorize a 
        sufficient transfer of funds from the 
        state's federal TANF block grant to the 
        state's federal social services block 
        grant to meet this appropriation.  The 
        funds shall be distributed to counties 
        for the children and community services 
        grant according to the formula for the 
        state appropriations in Minnesota 
        Statutes, chapter 256M. 
        [TANF FUNDS FOR FISCAL YEAR 2006 AND 
        FISCAL YEAR 2007 REFINANCING.] 
        $12,692,000 $6,692,000 in fiscal year 
        2006 and $9,192,000 $3,192,000 in 
        fiscal year 2007 in TANF funds are 
        available to the commissioner to 
        replace general funds in the amount 
        of $12,692,000 $6,692,000 in fiscal 
        year 2006 and $9,192,000 $3,192,000 in 
        fiscal year 2007 in expenditures that 
        may be counted toward TANF maintenance 
        of effort requirements or as an 
        allowable TANF expenditure. 
        [ADJUSTMENTS IN TANF TRANSFER TO CHILD 
        CARE AND DEVELOPMENT FUND.] Transfers 
        of TANF to the child care development 
        fund for the purposes of MFIP child 
        care assistance shall be reduced by 
        $116,000 in fiscal year 2004 and shall 
        be increased by $1,976,000 in fiscal 
        year 2005. 
           Sec. 4.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 2, subdivision 6, is amended to read: 
        Subd. 6.  Basic Health Care Grants 
                      Summary by Fund
        General           1,499,941,000 1,533,016,000
                          1,290,454,000 1,475,996,000
        Health Care Access  268,151,000   282,605,000
                            254,121,000   282,689,000
        [UPDATING FEDERAL POVERTY GUIDELINES.] 
        Annual updates to the federal poverty 
        guidelines are effective each July 1, 
        following publication by the United 
        States Department of Health and Human 
        Services for health care programs under 
        Minnesota Statutes, chapters 256, 256B, 
        256D, and 256L. 
        The amounts that may be spent from this 
        appropriation for each purpose are as 
        follows: 
        (a) MinnesotaCare Grants 
        Health Care Access 267,401,000   281,855,000
                           253,371,000   281,939,000
        [MINNESOTACARE FEDERAL RECEIPTS.] 
        Receipts received as a result of 
        federal participation pertaining to 
        administrative costs of the Minnesota 
        health care reform waiver shall be 
        deposited as nondedicated revenue in 
        the health care access fund.  Receipts 
        received as a result of federal 
        participation pertaining to grants 
        shall be deposited in the federal fund 
        and shall offset health care access 
        funds for payments to providers. 
        [MINNESOTACARE FUNDING.] The 
        commissioner may expend money 
        appropriated from the health care 
        access fund for MinnesotaCare in either 
        fiscal year of the biennium. 
        (b) MA Basic Health Care Grants - 
        Families and Children 
        General             568,254,000   582,161,000
                            427,769,000   489,545,000
        [SERVICES TO PREGNANT WOMEN.] The 
        commissioner shall use available 
        federal money for the State-Children's 
        Health Insurance Program for medical 
        assistance services provided to 
        pregnant women who are not otherwise 
        eligible for federal financial 
        participation beginning in fiscal year 
        2003.  This federal money shall be 
        deposited in the federal fund and shall 
        offset general funds for payments to 
        providers.  Notwithstanding section 14, 
        this paragraph shall not expire. 
        [MANAGED CARE RATE INCREASE.] (a) 
        Effective January 1, 2004, the 
        commissioner of human services shall 
        increase the total payments to managed 
        care plans under Minnesota Statutes, 
        section 256B.69, by an amount equal to 
        the cost increases to the managed care 
        plans from by the elimination of: (1) 
        the exemption from the taxes imposed 
        under Minnesota Statutes, section 
        297I.05, subdivision 5, for premiums 
        paid by the state for medical 
        assistance, general assistance medical 
        care, and the MinnesotaCare program; 
        and (2) the exemption of gross revenues 
        subject to the taxes imposed under 
        Minnesota Statutes, sections 295.50 to 
        295.57, for payments paid by the state 
        for services provided under medical 
        assistance, general assistance medical 
        care, and the MinnesotaCare program.  
        Any increase based on clause (2) must 
        be reflected in provider rates paid by 
        the managed care plan unless the 
        managed care plan is a staff model 
        health plan company. 
        (b) The commissioner of human services 
        shall increase by two percent the 
        fee-for-service payments under medical 
        assistance, general assistance medical 
        care, and the MinnesotaCare program for 
        services subject to the hospital, 
        surgical center, or health care 
        provider taxes under Minnesota 
        Statutes, sections 295.50 to 295.57, 
        effective for services rendered on or 
        after January 1, 2004.  
        (c) The commissioner of finance shall 
        transfer from the health care access 
        fund to the general fund the following 
        amounts in the fiscal years indicated:  
        2004, $16,587,000; 2005, $46,322,000; 
        2006, $49,413,000; and 2007, 
        $52,659,000. 
        (d) For fiscal years after 2007, the 
        commissioner of finance shall transfer 
        from the health care access fund to the 
        general fund an amount equal to the 
        revenue collected by the commissioner 
        of revenue on the following:  
        (1) gross revenues received by 
        hospitals, surgical centers, and health 
        care providers as payments for services 
        provided under medical assistance, 
        general assistance medical care, and 
        the MinnesotaCare program, including 
        payments received directly from the 
        state or from a prepaid plan, under 
        Minnesota Statutes, sections 295.50 to 
        295.57; and 
        (2) premiums paid by the state under 
        medical assistance, general assistance 
        medical care, and the MinnesotaCare 
        program under Minnesota Statutes, 
        section 297I.05, subdivision 5.  
        The commissioner of finance shall 
        monitor and adjust if necessary the 
        amount transferred each fiscal year 
        from the health care access fund to the 
        general fund to ensure that the amount 
        transferred equals the tax revenue 
        collected for the items described in 
        clauses (1) and (2) for that fiscal 
        year. 
        (e) Notwithstanding section 14, these 
        provisions shall not expire. 
        (c) MA Basic Health Care Grants - Elderly 
        and Disabled 
        General             695,421,000   741,605,000
                            610,518,000   743,858,000
        [DELAY MEDICAL ASSISTANCE 
        FEE-FOR-SERVICE - ACUTE CARE.] The 
        following payments in fiscal year 2005 
        from the Medicaid Management 
        Information System that would otherwise 
        have been made to providers for medical 
        assistance and general assistance 
        medical care services shall be delayed 
        and included in the first payment in 
        fiscal year 2006: 
        (1) for hospitals, the last two 
        payments; and 
        (2) for nonhospital providers, the last 
        payment. 
        This payment delay shall not include 
        payments to skilled nursing facilities, 
        intermediate care facilities for mental 
        retardation, prepaid health plans, home 
        health agencies, personal care nursing 
        providers, and providers of only waiver 
        services.  The provisions of Minnesota 
        Statutes, section 16A.124, shall not 
        apply to these delayed payments.  
        Notwithstanding section 14, this 
        provision shall not expire. 
        [DEAF AND HARD-OF-HEARING SERVICES.] 
        If, after making reasonable efforts, 
        the service provider for mental health 
        services to persons who are deaf or 
        hearing impaired is not able to earn 
        $227,000 through participation in 
        medical assistance intensive 
        rehabilitation services in fiscal year 
        2005, the commissioner shall transfer 
        $227,000 minus medical assistance 
        earnings achieved by the grantee to 
        deaf and hard-of-hearing grants to 
        enable the provider to continue 
        providing services to eligible persons. 
        (d) General Assistance Medical Care 
        Grants 
        General             223,960,000   196,617,000
                            239,861,000   229,960,000
        (e) Health Care Grants - Other 
        Assistance 
        General               3,067,000     3,407,000
        Health Care Access      750,000       750,000
        [MINNESOTA PRESCRIPTION DRUG DEDICATED 
        FUND.] Of the general fund 
        appropriation, $284,000 in fiscal year 
        2005 is appropriated to the 
        commissioner for the prescription drug 
        dedicated fund established under the 
        prescription drug discount program. 
        [DENTAL ACCESS GRANTS CARRYOVER 
        AUTHORITY.] Any unspent portion of the 
        appropriation from the health care 
        access fund in fiscal years 2002 and 
        2003 for dental access grants under 
        Minnesota Statutes, section 256B.53, 
        shall not cancel but shall be allowed 
        to carry forward to be spent in the 
        biennium beginning July 1, 2003, for 
        these purposes. 
        [STOP-LOSS FUND ACCOUNT.] The 
        appropriation to the purchasing 
        alliance stop-loss fund account 
        established under Minnesota Statutes, 
        section 256.956, subdivision 2, for 
        fiscal years 2004 and 2005 shall only 
        be available for claim reimbursements 
        for qualifying enrollees who are 
        members of purchasing alliances that 
        meet the requirements described under 
        Minnesota Statutes, section 256.956, 
        subdivision 1, paragraph (f), clauses 
        (1), (2), and (3). 
        (f) Prescription Drug Program 
        General               9,239,000     9,226,000
        [PRESCRIPTION DRUG ASSISTANCE PROGRAM.] 
        Of the general fund appropriation, 
        $702,000 in fiscal year 2004 and 
        $887,000 in fiscal year 2005 are for 
        the commissioner to establish and 
        administer the prescription drug 
        assistance program through the 
        Minnesota board on aging. 
        [REBATE REVENUE RECAPTURE.] Any funds 
        received by the state from a drug 
        manufacturer due to errors in the 
        pharmaceutical pricing used by the 
        manufacturer in determining the 
        prescription drug rebate are 
        appropriated to the commissioner to 
        augment funding of the prescription 
        drug program established in Minnesota 
        Statutes, section 256.955. 
           Sec. 5.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 2, subdivision 7, is amended to read: 
        Subd. 7.  Health Care Management 
                      Summary by Fund
        General              24,845,000    26,199,000
                             24,834,000
        Health Care Access   14,522,000    14,533,000
        The amounts that may be spent from this 
        appropriation for each purpose are as 
        follows: 
        (a) Health Care Policy Administration 
        General               5,523,000     7,223,000
        Health Care Access    1,066,000     1,200,000
        [PAYMENT CODE STUDY.] Of this 
        appropriation, $345,000 each year is 
        for a study to determine the 
        appropriateness of eliminating 
        reimbursement for certain payment codes 
        under medical assistance, general 
        assistance medical care, or 
        MinnesotaCare.  As part of the study, 
        the commissioner shall also examine 
        covered services under the Minnesota 
        health care programs and make 
        recommendations on possible 
        modification of the services covered 
        under the program.  The commissioner 
        shall report to the legislature by 
        January 15, 2005, with an analysis of 
        the feasibility of this approach, a 
        list of codes, if any, to be eliminated 
        from the payment system, and estimates 
        of savings to be obtained from this 
        approach. 
        [TRANSFERS FROM HEALTH CARE ACCESS 
        FUND.] (a) Notwithstanding Minnesota 
        Statutes, section 295.581, to the 
        extent available resources in the 
        health care access fund exceed 
        expenditures in that fund during fiscal 
        years 2005 to 2007, the excess annual 
        funds shall be transferred from the 
        health care access fund to the general 
        fund on June 30 of fiscal years 2005, 
        2006, and 2007.  These transfers shall 
        not be reduced to accommodate 
        MinnesotaCare expansions.  The 
        estimated amounts to be transferred are:
        (1) in fiscal year 2005, $192,442,000; 
        (2) in fiscal year 2006, $52,943,000; 
        and 
        (3) in fiscal year 2007, $59,105,000. 
        These estimates shall be updated with 
        each forecast, but in no case shall the 
        transfers exceed the amounts listed in 
        clauses (1) to (3). 
        (b) The commissioner shall limit 
        transfers under paragraph (a) in order 
        to avoid implementation of Minnesota 
        Statutes, section 256L.02, subdivision 
        3, paragraph (b). 
        (c) For fiscal years 2004 to 2007, 
        MinnesotaCare shall be a forecasted 
        program and, if necessary, the 
        commissioner shall reduce transfers 
        under paragraph (a) to meet forecasted 
        expenditures. 
        (d) The department of human services in 
        recommending its 2007-2008 budget shall 
        consider the repayment of the amount 
        transferred in fiscal years 2006 and 
        2007 from the health care access fund 
        to the general fund to the health care 
        access fund. 
        (e) Notwithstanding section 14, this 
        section is in effect until June 30, 
        2007. 
        [MINNESOTACARE OUTREACH REIMBURSEMENT.] 
        Federal administrative reimbursement 
        resulting from MinnesotaCare outreach 
        is appropriated to the commissioner for 
        this activity. 
        [MINNESOTA SENIOR HEALTH OPTIONS 
        REIMBURSEMENT.] Federal administrative 
        reimbursement resulting from the 
        Minnesota senior health options project 
        is appropriated to the commissioner for 
        this activity. 
        [UTILIZATION REVIEW.] Federal 
        administrative reimbursement resulting 
        from prior authorization and inpatient 
        admission certification by a 
        professional review organization shall 
        be dedicated to the commissioner for 
        these purposes.  A portion of these 
        funds must be used for activities to 
        decrease unnecessary pharmaceutical 
        costs in medical assistance. 
        (b) Health Care Operations 
        General              19,322,000    18,976,000
                             19,311,000
        Health Care Access   13,456,000    13,333,000
        [PREPAID MEDICAL PROGRAMS.] For all 
        counties in which the PMAP program has 
        been operating for 12 or more months, 
        state funding for the nonfederal share 
        of prepaid medical assistance program 
        administration costs for county managed 
        care advocacy and enrollment operations 
        is eliminated.  State funding will 
        continue for these activities for 
        counties and tribes establishing new 
        PMAP programs for a maximum of 16 
        months (four months prior to beginning 
        PMAP enrollment and through the first 
        12 months of their PMAP program 
        operation).  Those counties operating 
        PMAP programs for less than 12 months 
        can continue to receive state funding 
        for advocacy and enrollment activities 
        through their first year of operation. 
           Sec. 6.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 2, subdivision 9, is amended to read: 
        Subd. 9.  Continuing Care Grants 
                      Summary by Fund
        General           1,504,933,000 1,490,958,000
                          1,448,029,000 1,567,392,000
        Lottery Prize Fund    1,408,000     1,408,000
        The amounts that may be spent from this 
        appropriation for each purpose are as 
        follows: 
        (a) Community Social Services
        General                 496,000       371,000
        (b) Aging and Adult Service Grant 
        General              12,998,000    13,951,000
        [LONG-TERM CARE PROGRAM REDUCTIONS.] 
        For the biennium ending June 30, 2005, 
        state funding for the following state 
        long-term care programs is reduced by 
        15 percent from the level of state 
        funding provided on June 30, 2003:  
        SAIL project grants under Minnesota 
        Statutes, section 256B.0917; senior 
        nutrition programs under Minnesota 
        Statutes, section 256.9752; foster 
        grandparents program under Minnesota 
        Statutes, section 256.976; retired 
        senior volunteer program under 
        Minnesota Statutes, section 256.9753; 
        and the senior companion program under 
        Minnesota Statutes, section 256.977. 
        (c) Deaf and Hard-of-hearing 
        Service Grants 
        General               1,719,000     1,490,000
        (d) Mental Health Grants 
        General              53,479,000    34,690,000
                                           46,551,000
        Lottery Prize Fund    1,408,000     1,408,000
        [RESTRUCTURING OF ADULT MENTAL HEALTH 
        SERVICES.] The commissioner may make 
        transfers that do not increase the 
        state share of costs to effectively 
        implement the restructuring of adult 
        mental health services.  
        [COMPULSIVE GAMBLING.] Of the 
        appropriation from the lottery prize 
        fund, $250,000 each year is for the 
        following purposes: 
        (1) $100,000 each year is for a grant 
        to the Southeast Asian Problem Gambling 
        Consortium.  The consortium must 
        provide statewide compulsive gambling 
        prevention and treatment services for 
        Lao, Hmong, Vietnamese, and Cambodian 
        families, adults, and adolescents.  The 
        appropriation in this clause shall not 
        become part of base level funding for 
        the biennium beginning July 1, 2005.  
        Any unencumbered balance of the 
        appropriation in the first year does 
        not cancel but is available for the 
        second year; and 
        (2) $150,000 each year is for a grant 
        to a compulsive gambling council 
        located in St. Louis county.  The 
        gambling council must provide a 
        statewide compulsive gambling 
        prevention and education project for 
        adolescents.  Any unencumbered balance 
        of the appropriation in the first year 
        of the biennium does not cancel but is 
        available for the second year. 
        (e) Community Support Grants 
                              12,523,000   9,093,000
                                          12,024,000
        [CENTERS FOR INDEPENDENT LIVING STUDY.] 
        The commissioner of human services, in 
        consultation with the commissioner of 
        economic security, the centers for 
        independent living, and consumer 
        representatives, shall study the 
        financing of the centers for 
        independent living authorized under 
        Minnesota Statutes, section 268A.11, 
        and make recommendations on options to 
        maximize federal financial 
        participation.  Study components shall 
        include: 
        (1) the demographics of individuals 
        served by the centers for independent 
        living; 
        (2) the range of services the centers 
        for independent living provide to these 
        individuals; 
        (3) other publicly funded services 
        received by individuals supported by 
        the centers; and 
        (4) strategies for maximizing federal 
        financial participation for eligible 
        activities carried out by centers for 
        independent living. 
        The commissioner shall report with 
        fiscal and programmatic recommendations 
        to the chairs of the appropriate house 
        of representatives and senate finance 
        and policy committees by January 15, 
        2004. 
        (f) Medical Assistance Long-Term 
        Care Waivers and Home Care Grants 
        General              659,211,000  718,665,000
                             624,631,000  748,189,000
        [RATE AND ALLOCATION DECREASES FOR 
        CONTINUING CARE PROGRAMS.] 
        Notwithstanding any law or rule to the 
        contrary, the commissioner of human 
        services shall decrease reimbursement 
        rates or reduce allocations to assure 
        the necessary reductions in state 
        spending for the providers or programs 
        listed in paragraphs (a) to (d).  The 
        decreases are effective for services 
        rendered on or after July 1, 2003. 
        (a) Effective July 1, 2003, the 
        commissioner shall reduce payment rates 
        for services and individual or service 
        limits by one percent.  The rate 
        decreases described in this section 
        must be applied to: 
        (1) home and community-based waivered 
        services for the elderly under 
        Minnesota Statutes, section 256B.0915; 
        (2) day training and habilitation 
        services for adults with mental 
        retardation or related conditions under 
        Minnesota Statutes, sections 252.40 to 
        252.46; 
        (3) the group residential housing 
        supplementary service rate under 
        Minnesota Statutes, section 256I.05, 
        subdivision 1a; 
        (4) chemical dependency residential and 
        nonresidential service rates under 
        Minnesota Statutes, section 245B.03; 
        (5) consumer support grants under 
        Minnesota Statutes, section 256.476; 
        and 
        (6) home and community-based services 
        for alternative care services under 
        Minnesota Statutes, section 256B.0913. 
        (b) The commissioner shall reduce 
        allocations made available to county 
        agencies for home and community-based 
        waivered services to assure a 
        one-percent reduction in state spending 
        for services rendered on or after July 
        1, 2003.  The commissioner shall apply 
        the allocation decreases described in 
        this section to: 
        (1) persons with mental retardation or 
        related conditions under Minnesota 
        Statutes, section 256B.501; 
        (2) waivered services under community 
        alternatives for disabled individuals 
        under Minnesota Statutes, section 
        256B.49; 
        (3) community alternative care waivered 
        services under Minnesota Statutes, 
        section 256B.49; and 
        (4) traumatic brain injury waivered 
        services under Minnesota Statutes, 
        section 256B.49. 
        County agencies will be responsible for 
        100 percent of any spending in excess 
        of the allocation made by the 
        commissioner.  Nothing in this section 
        shall be construed as reducing the 
        county's responsibility to offer and 
        make available feasible home and 
        community-based options to eligible 
        waiver recipients within the resources 
        allocated to them for that purpose. 
        (c) The commissioner shall reduce deaf 
        and hard-of-hearing grants by one 
        percent on July 1, 2003. 
        (d) Effective July 1, 2003, the 
        commissioner shall reduce payment rates 
        for each facility reimbursed under 
        Minnesota Statutes, section 256B.5012, 
        by decreasing the total operating 
        payment rate for intermediate care 
        facilities for the mentally retarded by 
        one percent.  For each facility, the 
        commissioner shall multiply the 
        adjustment by the total payment rate, 
        excluding the property-related payment 
        rate, in effect on June 30, 2003.  A 
        facility whose payment rates are 
        governed by closure agreements, 
        receivership agreements, or Minnesota 
        Rules, part 9553.0075, is not subject 
        to an adjustment otherwise taken under 
        this subdivision. 
        Notwithstanding section 14, these 
        adjustments shall not expire. 
        [REDUCE GROWTH IN MR/RC WAIVER.] The 
        commissioner shall reduce the growth in 
        the MR/RC waiver by not allocating the 
        300 additional diversion allocations 
        that are included in the February 2003 
        forecast for the fiscal years that 
        begin on July 1, 2003, and July 1, 2004.
        [MANAGE THE GROWTH IN THE TBI WAIVER.] 
        During the fiscal years beginning on 
        July 1, 2003, and July 1, 2004, the 
        commissioner shall allocate money for 
        home and community-based programs 
        covered under Minnesota Statutes, 
        section 256B.49, to assure a reduction 
        in state spending that is equivalent to 
        limiting the caseload growth of the TBI 
        waiver to 150 in each year of the 
        biennium.  Priorities for the 
        allocation of funds shall be for 
        individuals anticipated to be 
        discharged from institutional settings 
        or who are at imminent risk of a 
        placement in an institutional setting. 
        [TARGETED CASE MANAGEMENT FOR HOME CARE 
        RECIPIENTS.] Implementation of the 
        targeted case management benefit for 
        home care recipients, according to 
        Minnesota Statutes, section 256B.0621, 
        subdivisions 2, 3, 5, 6, 7, 9, and 10, 
        will be delayed until July 1, 2005. 
        [COMMON SERVICE MENU.] Implementation 
        of the common service menu option 
        within the home and community-based 
        waivers, according to Minnesota 
        Statutes, section 256B.49, subdivision 
        16, will be delayed until July 1, 2005. 
        [LIMITATION ON COMMUNITY ALTERNATIVES 
        FOR DISABLED INDIVIDUALS CASELOAD 
        GROWTH.] For the biennium ending June 
        30, 2005, the commissioner shall limit 
        the allocations made available in the 
        community alternatives for disabled 
        individuals waiver program in order not 
        to exceed average caseload growth of 95 
        per month from June 2003 program 
        levels, plus any additional 
        legislatively authorized program 
        growth.  The commissioner shall 
        allocate available resources to achieve 
        the following outcomes: 
        (1) the establishment of feasible and 
        viable alternatives for persons in 
        institutional or hospital settings to 
        relocate to home and community-based 
        settings; 
        (2) the availability of timely 
        assistance to persons at imminent risk 
        of institutional or hospital placement 
        or whose health and safety is at 
        immediate risk; and 
        (3) the maximum provision of essential 
        community supports to eligible persons 
        in need of and waiting for home and 
        community-based service alternatives.  
        The commissioner may reallocate 
        resources from one county or region to 
        another if available funding in that 
        county or region is not likely to be 
        spent and the reallocation is necessary 
        to achieve the outcomes specified in 
        this paragraph. 
        (g) Medical Assistance Long-term 
        Care Facilities Grants 
        General             543,999,000   514,483,000
                            513,763,000   536,321,000
        (h) Alternative Care Grants 
        General              75,206,000    66,351,000
        [ALTERNATIVE CARE TRANSFER.] Any money 
        allocated to the alternative care 
        program that is not spent for the 
        purposes indicated does not cancel but 
        shall be transferred to the medical 
        assistance account. 
        [ALTERNATIVE CARE APPROPRIATION.] The 
        commissioner may expend the money 
        appropriated for the alternative care 
        program for that purpose in either year 
        of the biennium. 
        [ALTERNATIVE CARE IMPLEMENTATION OF 
        CHANGES TO FEES AND ELIGIBILITY.] 
        Changes to Minnesota Statutes, section 
        256B.0913, subdivision 4, paragraph 
        (d), and subdivision 12, are effective 
        July 1, 2003, for all persons found 
        eligible for the alternative care 
        program on or after July 1, 2003.  All 
        recipients of alternative care funding 
        as of June 30, 2003, shall be subject 
        to Minnesota Statutes, section 
        256B.0913, subdivision 4, paragraph 
        (d), and subdivision 12, on the annual 
        reassessment and review of their 
        eligibility after July 1, 2003, but no 
        later than January 1, 2004. 
        (i) Group Residential Housing Grants 
        General              94,996,000    80,472,000
                             94,547,000    81,055,000
        [GROUP RESIDENTIAL HOUSING COSTS 
        REFINANCED.] (1) Effective July 1, 
        2004, the commissioner shall increase 
        the home and community-based service 
        rates and county allocations provided 
        to programs for persons with 
        disabilities established under section 
        1915(c) of the Social Security Act to 
        the extent that these programs will be 
        paying for the costs above the rate 
        established in Minnesota Statutes, 
        section 256I.05, subdivision 1. 
        (2) For persons in receipt of services 
        under Minnesota Statutes, section 
        256B.0915, who reside in licensed adult 
        foster care beds for which a 
        supplemental room and board payment was 
        being made under Minnesota Statutes, 
        section 256I.05, subdivision 1, 
        counties may request an exception to 
        the individual caps specified in 
        Minnesota Statutes, section 256B.0915, 
        subdivision 3, paragraph (b), not to 
        exceed the difference between the 
        individual cap and the client's monthly 
        service expenditures plus the amount of 
        the supplemental room and board rate.  
        The county must submit a request to 
        exceed the individual cap to the 
        commissioner for approval. 
        (j) Chemical Dependency
        Entitlement Grants 
        General              49,251,000    50,337,000
                             57,612,000    60,034,000
        (k) Chemical Dependency Nonentitlement 
        Grants 
        General               1,055,000     1,055,000
           Sec. 7.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 2, subdivision 11, is amended to read: 
        Subd. 11.  Economic Support Grants 
                      Summary by Fund
        General             122,647,000   117,198,000
                            124,697,000   116,985,000
        Federal TANF        199,009,000   207,224,000
                            212,844,000   209,264,000
        The amounts that may be spent from this 
        appropriation for each purpose are as 
        follows: 
        (a) Minnesota Family Investment Program 
        General              59,922,000   39,375,000
                             53,818,000   43,942,000
        Federal TANF        106,535,000   110,543,000
                            114,370,000   106,583,000
        (b) Work Grants 
        General                 666,000    14,678,000
                              8,666,000     8,678,000
        Federal TANF         92,474,000    96,681,000
                             98,474,000   102,681,000
        [MFIP SUPPORT SERVICES COUNTY AND 
        TRIBAL ALLOCATION.] When determining 
        the funds available for the 
        consolidated MFIP support services 
        grant in the 18-month period ending 
        December 31, 2004, the commissioner 
        shall apportion the funds appropriated 
        for fiscal year 2005 in such manner as 
        necessary to provide $14,000,000 more 
        to counties and tribes for the period 
        ending December 31, 2004, than would 
        have been available had the funds been 
        evenly divided within the fiscal year 
        between the period before December 31, 
        2004, and the period after December 31, 
        2004. 
        For allocations for the calendar years 
        starting January 1, 2005, the 
        commissioner shall apportion the funds 
        appropriated for each fiscal year in 
        such manner as necessary to provide 
        $14,000,000 more to counties and tribes 
        for the period ending December 31 of 
        that year than would have been 
        available had the funds been evenly 
        divided within the fiscal year between 
        the period before December 31 and the 
        period after December 31. 
        (c) Economic Support Grants - Other 
        Assistance 
        General               3,358,000     3,463,000
        [SUPPORTIVE HOUSING.] Of the general 
        fund appropriation, $500,000 each year 
        is to provide services to families who 
        are participating in the supportive 
        housing and managed care pilot project 
        under Minnesota Statutes, section 
        256K.25.  This appropriation shall not 
        become part of base level funding for 
        the biennium beginning July 1, 2007. 
        (d) Child Support Enforcement Grants 
        General               3,571,000     3,503,000
        (e) General Assistance Grants
        General              24,901,000    24,732,000
                             26,329,000    26,909,000
        [GENERAL ASSISTANCE STANDARD.] The 
        commissioner shall set the monthly 
        standard of assistance for general 
        assistance units consisting of an adult 
        recipient who is childless and 
        unmarried or living apart from parents 
        or a legal guardian at $203.  The 
        commissioner may reduce this amount 
        according to Laws 1997, chapter 85, 
        article 3, section 54. 
        [EMERGENCY GENERAL ASSISTANCE.] The 
        amount appropriated for emergency 
        general assistance funds is limited to 
        no more than $7,889,812 in each fiscal 
        year of 2004 and 2005.  Funds to 
        counties shall be allocated by the 
        commissioner using the allocation 
        method specified in Minnesota Statutes, 
        section 256D.06. 
        (f) Minnesota Supplemental Aid Grants 
        General              30,229,000    31,447,000
                             28,955,000    30,490,000
        [EMERGENCY MINNESOTA SUPPLEMENTAL AID 
        FUNDS.] The amount appropriated for 
        emergency Minnesota supplemental aid 
        funds is limited to no more than 
        $1,138,707 in fiscal year 2004 and 
        $1,017,000 in fiscal year 2005.  Funds 
        to counties shall be allocated by the 
        commissioner using the allocation 
        method specified in Minnesota Statutes, 
        section 256D.46. 
           Sec. 8.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 10, subdivision 1, is amended to read: 
        Subdivision 1.  Total 
        Appropriation                     $  107,829,000 $   92,649,000
                                             106,221,000     97,564,000
                      Summary by Fund
        General             104,489,000    89,309,000
                            102,881,000    92,224,000
        State Special 
        Revenue               3,340,000     3,340,000 
           Sec. 9.  Laws 2003, First Special Session chapter 14, 
        article 13C, section 10, subdivision 2, is amended to read: 
        Subd. 2.  Child Care 
        [BASIC SLIDING FEE CHILD CARE.] Of this 
        appropriation, $27,628,000 in fiscal 
        year 2004 and $18,771,000 in fiscal 
        year 2005 are for child care assistance 
        according to Minnesota Statutes, 
        section 119B.03.  These appropriations 
        are available to be spent either year.  
        The fiscal years 2006 and 2007 general 
        fund base for basic sliding fee child 
        care is $30,312,000 each year. 
        [MFIP CHILD CARE.] Of this 
        appropriation, $69,543,000 $67,935,000 
        in fiscal year 2004 
        and $63,720,000 $68,635,000 in fiscal 
        year 2005 are for MFIP child care. 
        [CHILD CARE PROGRAM INTEGRITY.] Of this 
        appropriation, $425,000 in fiscal year 
        2004, and $376,000 in fiscal year 2005 
        are for the administrative costs of 
        program integrity and fraud prevention 
        for child care assistance under 
        Minnesota Statutes, chapter 119B. 
        [CHILD CARE DEVELOPMENT.] Of this 
        appropriation, $1,115,000 in fiscal 
        year 2004, and $1,164,000 in fiscal 
        year 2005 are for child care 
        development grants according to 
        Minnesota Statutes, section 119B.21. 
           Sec. 10.  [EFFECTIVE DATE.] 
           Sections 1 to 9 are effective the day following final 
        enactment, unless a different effective date is specified. 

                                   ARTICLE 3
                              ADDITIONAL REVENUES
           Section 1.  Minnesota Statutes 2003 Supplement, section 
        16A.152, subdivision 2, is amended to read: 
           Subd. 2.  [ADDITIONAL REVENUES; PRIORITY.] (a) If on the 
        basis of a forecast of general fund revenues and expenditures, 
        the commissioner of finance determines that there will be a 
        positive unrestricted budgetary general fund balance at the 
        close of the biennium, the commissioner of finance must allocate 
        money to the following accounts and purposes in priority order: 
           (1) the cash flow account established in subdivision 1 
        until that account reaches $350,000,000; and 
           (2) the budget reserve account established in subdivision 
        1a until that account reaches $653,000,000; 
           (3) the amount necessary to increase the aid payment 
        schedule for school district aids and credits payments in 
        section 127A.45 to not more than 90 percent; and 
           (4) the amount necessary to restore all or a portion of the 
        net aid reductions under section 127A.441 and to reduce the 
        property tax revenue recognition shift under section 123B.75, 
        subdivision 5, paragraph (c), and Laws 2003, First Special 
        Session chapter 9, article 5, section 34, as amended by Laws 
        2003, First Special Session chapter 23, section 20, by the same 
        amount. 
           (b) The amounts necessary to meet the requirements of this 
        section are appropriated from the general fund within two weeks 
        after the forecast is released or, in the case of transfers 
        under paragraph (a), clauses (3) and (4), as necessary to meet 
        the appropriations schedules otherwise established in statute. 
           (c) To the extent that a positive unrestricted budgetary 
        general fund balance is projected, appropriations under this 
        section must be made before any transfer is made under section 
        16A.1522. 
           (d) The commissioner of finance shall certify the total 
        dollar amount of the reductions under 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. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 

                                   ARTICLE 4 
                          PUBLIC FACILITIES AUTHORITY 
           Section 1.  Minnesota Statutes 2002, section 446A.12, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [BONDING AUTHORITY.] The authority may 
        issue negotiable bonds in a principal amount that the authority 
        determines necessary to provide sufficient funds for achieving 
        its purposes, including the making of loans and purchase of 
        securities, the payment of interest on bonds of the authority, 
        the establishment of reserves to secure its bonds, the payment 
        of fees to a third party providing credit enhancement, and the 
        payment of all other expenditures of the authority incident to 
        and necessary or convenient to carry out its corporate purposes 
        and powers, but not including the making of grants.  Bonds of 
        the authority may be issued as bonds or notes or in any other 
        form authorized by law.  The principal amount of bonds issued 
        and outstanding under this section at any time may not exceed 
        $1,000,000,000 $1,250,000,000, excluding bonds for which 
        refunding bonds or crossover refunding bonds have been issued. 
           Sec. 2.  Minnesota Statutes 2002, section 446A.14, is 
        amended to read: 
           446A.14 [INTEREST EXCHANGES RATE SWAPS AND OTHER 
        AGREEMENTS.] 
           The authority may enter into an agreement with a third 
        party for an exchange of interest rates under this subdivision.  
        With respect to outstanding obligations bearing interest at a 
        variable rate, the authority may agree to pay sums equal to 
        interest at a fixed rate or at a different variable rate 
        determined in accordance with a formula set out in the agreement 
        on an amount not exceeding the outstanding principal amount of 
        the obligations, in exchange for an agreement by the third party 
        to pay sums equal to interest on a similar amount at a variable 
        rate determined according to a formula set out in the agreement. 
        With respect to outstanding obligations bearing interest at a 
        fixed rate or rates, the authority may agree to pay sums equal 
        to interest at a variable rate determined according to a formula 
        set out in the agreement on an amount not exceeding the 
        outstanding principal amount of the obligations in exchange for 
        an agreement by the third party to pay sums equal to interest on 
        a similar amount at a fixed rate or rates set out in the 
        agreement.  Subject to any applicable bonds covenants, payments 
        required to be made by the municipality under the swap agreement 
        may be made from amounts secured to pay debt service on the 
        obligations with respect to which the swap agreement was made 
        from any other available source of the authority. Subdivision 1. 
        [AGREEMENTS.] (a) The authority may enter into interest rate 
        exchange or swap agreements, hedges, forward purchase or sale 
        agreements, loan sale or pooling agreements or trusts, or other 
        similar agreements in connection with: 
           (1) the issuance or proposed issuance of bonds; 
           (2) the making, proposed making, or sale of loans or other 
        financial assistance or investments; 
           (3) outstanding bonds, loans, or other financial 
        assistance; or 
           (4) existing similar agreements.  
           (b) The agreements authorized by this subdivision include, 
        without limitation, master agreements, options or contracts to 
        enter into those agreements in the future and related 
        agreements, including, without limitation, agreements to provide 
        credit enhancement, liquidity, or remarketing; valuation; 
        monitoring; or administrative services currently or in the 
        future.  However, the term of an option to enter into an 
        interest rate swap, exchange, hedge, or other similar agreement 
        and the term of a contract to sell, buy, or refund bonds in the 
        future must not exceed five years and the authorization of the 
        authority to enter into option agreements with respect to 
        interest rate swap agreements expires on December 31, 2008; 
        provided that the option agreements entered into prior to that 
        date remain valid agreements of the authority after that date. 
           (c) The agreements authorized by this subdivision or 
        supplements to master agreements may be entered into on the 
        basis of negotiation with a qualified third party or through a 
        competitive proposal process on terms and conditions and with 
        covenants and provisions approved by the authority and may 
        include, without limitation: 
           (1) provisions establishing reserves; 
           (2) pledging assets or revenues of the authority for 
        current or other payments or termination payments; 
           (3) contracting with the other parties to the agreements to 
        provide for the custody, collection, securing, investment, and 
        payment of money of the authority or money held in trust; or 
           (4) requiring the issuance of bonds or entering into loans 
        or other agreements authorized by this subdivision in the future.
           (d) Subject to the terms of the agreement and other 
        agreements of the authority with bondholders or other third 
        parties, the agreements authorized by this subdivision may be 
        general or limited obligations of the authority payable from all 
        available or certain specified funds appropriated to the 
        authority.  The agreements authorized by this subdivision do not 
        constitute debt of the authority for the purposes of the limits 
        on bonds or notes of the authority set forth in section 446A.12, 
        subdivision 1.  
           (e) The authority may issue bonds to provide funds to make 
        payments, including, without limitation, termination payments 
        pursuant to an agreement authorized by this subdivision. 
           (f) The aggregate notional amount of interest rate swap or 
        exchange agreements in effect at any time must not exceed an 
        amount equal to ten percent of the aggregate principal amount of 
        bonds the authority is authorized to have outstanding pursuant 
        to section 446A.12, subdivision 1, including the notional amount 
        of interest rate swap or exchange agreements with respect to 
        which a reversing agreement has been entered into, the effect of 
        which is to terminate the original agreement or a portion 
        thereof, and reversing agreements with respect to all or a 
        portion of existing agreements. 
           Subd. 2.  [POWERS OF AUTHORITY.] For the purposes of this 
        section, the authority may exercise all powers provided in this 
        chapter.  The authority may consent, whenever it considers it 
        necessary or desirable in connection with agreements entered 
        into under this subdivision, to modifications, amendments, or 
        waivers of the terms of the agreements.  The proceeds of any 
        agreements entered into pursuant to this subdivision are 
        appropriated to the authority pursuant to section 446A.11, 
        subdivision 13.  The agreements entered into pursuant to this 
        subdivision are not subject to sections 16C.03, subdivision 4, 
        and 16C.05. 
           Sec. 3.  Minnesota Statutes 2002, section 446A.17, is 
        amended to read: 
           446A.17 [NONLIABILITY.] 
           Subdivision 1.  [NONLIABILITY OF INDIVIDUALS.] No member of 
        the authority or other person executing the bonds, loans, 
        interest rate swaps, or other agreements or contracts of the 
        authority is liable personally on the bonds, loans, interest 
        rate swaps, or other agreements or contracts of the authority or 
        is subject to any personal liability or accountability by reason 
        of their issuance, execution, delivery, or performance.  
           Subd. 2.  [NONLIABILITY OF STATE.] The state is not liable 
        on bonds, loans, interest rate swaps, or other agreements or 
        contracts of the authority issued or entered into under this 
        chapter and those bonds the bonds, loans, interest rate swaps, 
        or other agreements or contracts of the authority are not a debt 
        of the state.  The bonds, loans, interest rate swaps, or other 
        agreements or contracts of the authority must contain on their 
        face a statement to that effect. 
           Sec. 4.  Minnesota Statutes 2002, section 446A.19, is 
        amended to read: 
           446A.19 [STATE PLEDGE AGAINST IMPAIRMENT OF CONTRACTS.] 
           The state pledges and agrees with the holders of bonds 
        issued under sections 446A.051, and 446A.12 to 446A.20 or other 
        parties to any loans, interest rate swaps, or other agreements 
        or contracts of the authority that the state will not limit or 
        alter the rights vested in the authority to fulfill the terms of 
        any agreements made with the bondholders or parties to any 
        loans, interest rate swaps, or other agreements or contracts of 
        the authority or in any way impair the rights and remedies of 
        the holders until the bonds, together with interest on them, 
        with interest on any unpaid installments of interest, and all 
        costs and expenses in connection with any action or proceeding 
        by or on behalf of the bondholders, are fully met and discharged 
        or, with respect to any loans, interest rate swaps, or other 
        agreements or contracts of the authority, the agreements have 
        been fully performed by the authority or otherwise terminated or 
        discharged.  The authority may include this pledge and agreement 
        of the state in any agreement with the holders of bonds issued 
        under sections 446A.051, and 446A.12 to 446A.20 or in any loans, 
        interest rate swaps, or other agreements or contracts of the 
        authority. 
           Presented to the governor May 18, 2004 
           Signed by the governor May 29, 2004, 1:20 p.m.

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