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1997 Minnesota Session Laws

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                              CHAPTER 4-H.F.No. 1 
                  An act relating to education; kindergarten through 
                  grade 12; providing for general education; special 
                  programs; lifework development; education 
                  organization, cooperation, and facilities; education 
                  excellence; academic performance; education policy 
                  issues; libraries; technology; state agencies; 
                  conforming and technical amendments; school bus 
                  safety; tax deduction and credit; appropriating money; 
                  amending Minnesota Statutes 1996, sections 12.21, 
                  subdivision 3; 120.0111; 120.062, subdivisions 3, 6, 
                  7, 9, and 11; 120.0621, subdivisions 5a, 6, and by 
                  adding a subdivision; 120.064, subdivisions 3, 8, 10, 
                  20a, and by adding a subdivision; 120.101, 
                  subdivisions 5, 5c, and by adding a subdivision; 
                  120.1701, subdivision 3; 120.181; 121.15, subdivisions 
                  6, 7, and by adding subdivisions; 121.602, 
                  subdivisions 1, 2, and 4; 121.611; 121.615, 
                  subdivisions 2, 3, 5, 6, 7, 8, 9, and 10; 121.703, 
                  subdivision 3; 121.904, subdivision 4a; 123.35, 
                  subdivision 8, and by adding a subdivision; 123.3514, 
                  subdivisions 4, 4a, 4c, 4e, 6c, 8, and by adding 
                  subdivisions; 123.39, subdivision 6; 123.70, 
                  subdivisions 5, 7, and 10; 123.799, subdivision 1; 
                  123.7991, subdivisions 1 and 2; 123.951; 123.972, 
                  subdivision 5; 124.155, subdivisions 1 and 2; 124.17, 
                  subdivisions 1d, 4, and by adding subdivisions; 
                  124.193; 124.195, subdivisions 2, 7, 10, 11, and by 
                  adding a subdivision; 124.225, subdivisions 1, 13, 14, 
                  15, 16, and 17; 124.226, subdivision 10; 124.2445; 
                  124.2455; 124.248, subdivisions 3, 4, and by adding 
                  subdivisions; 124.26, subdivision 1b; 124.2613, 
                  subdivisions 3, 4, and 6; 124.2727, subdivision 6d; 
                  124.273, subdivisions 1d, 1e, 1f, and 5; 124.276, by 
                  adding a subdivision; 124.312, subdivisions 4 and 5; 
                  124.313; 124.314, subdivisions 1 and 2; 124.3201, 
                  subdivisions 1, 2, 3, and 4; 124.321, subdivision 1; 
                  124.323, subdivisions 1 and 2; 124.42, subdivision 4; 
                  124.431, subdivisions 2 and 11; 124.45; 124.481; 
                  124.574, subdivisions 1, 2d, 2f, 5, 6, and 9; 124.83, 
                  subdivisions 1 and 2; 124.86, subdivision 2, and by 
                  adding a subdivision; 124.91, subdivisions 1 and 5; 
                  124.912, subdivisions 1, 2, 3, and 6; 124.916, 
                  subdivisions 1, 2, and 3; 124.918, subdivision 6; 
                  124.95, subdivision 2; 124.961; 124A.03, subdivisions 
                  1c and 1g; 124A.04, subdivision 2; 124A.22, 
                  subdivisions 1, 2, as amended, 3, 6, 6a, 8a, 10, 11, 
                  13, 13b, 13d, and by adding a subdivision; 124A.225, 
                  subdivision 1; 124A.23, subdivisions 1, 2, 3, and 5; 
                  124A.26, subdivision 1; 124A.28; 124C.45, subdivision 
                  1a; 124C.46, subdivisions 1 and 2; 124C.498, 
                  subdivisions 2 and 3; 125.05, subdivisions 1c and 2; 
                  125.12, subdivision 14; 126.22, subdivisions 2, 3, 3a, 
                  and 8; 126.23, subdivision 1; 126.77, subdivision 1; 
                  127.26; 127.27, subdivisions 5, 6, 7, 8, 10, and by 
                  adding a subdivision; 127.281; 127.29; 127.30, 
                  subdivisions 1, 2, 3, and by adding a subdivision; 
                  127.31, subdivisions 2, 7, 8, 13, 14, and 15; 127.311; 
                  127.32; 127.33; 127.36; 127.37; 127.38; 128A.02, by 
                  adding a subdivision; 128B.10, subdivision 1; 128C.02, 
                  subdivision 2, and by adding a subdivision; 128C.12, 
                  subdivision 1; 129C.10, subdivision 3; 134.155, 
                  subdivisions 2 and 3; 134.34, subdivision 4; 136D.72, 
                  subdivisions 2 and 3; 144.29; 169.01, subdivision 6; 
                  169.435, subdivision 2; 169.443, subdivision 3; 
                  169.447, subdivision 6; 169.4501, subdivisions 1 and 
                  2; 169.4502, subdivisions 2, 7, 9, 11, and by adding 
                  subdivisions; 169.4503, subdivisions 1, 2, 10, 13, 14, 
                  17, 19, 23, 24, and by adding a subdivision; 169.4504, 
                  subdivision 1, and by adding a subdivision; 169.452; 
                  171.321, subdivision 3; 171.3215, subdivision 4; 
                  245.493, subdivision 1; 245.91, subdivision 2; 
                  260.185, subdivision 1; 260A.02, subdivision 3; 
                  268.665, subdivision 2; 290.01, subdivision 19b; and 
                  290.0671, subdivision 1; Laws 1991, chapter 265, 
                  article 1, section 30, as amended; Laws 1993, chapter 
                  146, article 5, section 20; Laws 1994, chapter 647, 
                  article 7, section 18, subdivisions 2 and 3; Laws 1995 
                  First Special Session, chapter 3, articles 1, section 
                  56; 2, section 52; 3, section 11, subdivisions 1, 2, 
                  and 5; 11, section 21, subdivision 3; and 12, section 
                  7, subdivision 1; Laws 1996, chapter 412, articles 4, 
                  section 34, subdivision 4; and 12, section 11; 
                  proposing coding for new law in Minnesota Statutes, 
                  chapters 120; 121; 124; 126; 127; 128C; 135A; and 290; 
                  repealing Minnesota Statutes 1996, sections 120.105; 
                  120.65; 121.11, subdivision 8; 121.602, subdivisions 3 
                  and 5; 121.904, subdivision 4d; 121.912, subdivision 
                  7; 124.17, subdivision 5; 124.177; 124.223; 124.225, 
                  subdivisions 3a, 7a, 7b, 7d, 7e, 8a, 8k, and 10; 
                  124.226; 124.2728; 124.276, subdivision 2; 124.3201, 
                  subdivisions 2a and 2b; 124.912, subdivisions 2 and 3; 
                  124A.22, subdivisions 4a and 4b; 124A.26, subdivisions 
                  1a, 2, 3, 4, and 5; 124C.74; 127.31, subdivision 6; 
                  134.34, subdivision 4a; 134.46; 169.4502, subdivision 
                  6; 169.4503, subdivisions 3, 8, 9, 11, 12, and 22; and 
                  169.454, subdivision 11. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
                                   ARTICLE 1 
                               GENERAL EDUCATION 
           Section 1.  Minnesota Statutes 1996, section 120.062, 
        subdivision 9, is amended to read: 
           Subd. 9.  [TRANSPORTATION.] (a) If requested by the parent 
        of a pupil, the nonresident district shall provide 
        transportation within the district.  The state shall pay 
        transportation aid to the district according to section 124.225. 
           The resident district is not required to provide or pay for 
        transportation between the pupil's residence and the border of 
        the nonresident district.  A parent may be reimbursed by the 
        nonresident district for the costs of transportation from the 
        pupil's residence to the border of the nonresident district if 
        the pupil is from a family whose income is at or below the 
        poverty level, as determined by the federal government.  The 
        reimbursement may not exceed the pupil's actual cost of 
        transportation or 15 cents per mile traveled, whichever is 
        less.  Reimbursement may not be paid for more than 250 miles per 
        week.  
           At the time a nonresident district notifies a parent or 
        guardian that an application has been accepted under subdivision 
        5 or 6, the nonresident district must provide the parent or 
        guardian with the following information regarding the 
        transportation of nonresident pupils under this section: 123.39, 
        subdivision 6. 
           (1) a nonresident district may transport a pupil within the 
        pupil's resident district under this section only with the 
        approval of the resident district; and 
           (2) a parent or guardian of a pupil attending a nonresident 
        district under this section may appeal under section 123.39, 
        subdivision 6, the refusal of the resident district to allow the 
        nonresident district to transport the pupil within the resident 
        district. 
           (b) Notwithstanding paragraph (a) and section 124.225, 
        subdivision 8l, transportation provided by a nonresident 
        district between home and school for a pupil attending school 
        under this section is authorized for nonregular transportation 
        revenue under section 124.225, if the following criteria are met:
           (1) the school that the pupil was attending prior to 
        enrolling in the nonresident district under this section was 
        closed; 
           (2) the distance from the closed school to the next nearest 
        school in the district that the student could attend is at least 
        20 miles; 
           (3) the pupil's residence is at least 20 miles from any 
        school that the pupil could attend in the resident district; and 
           (4) the pupil's residence is closer to the school of 
        attendance in the nonresident district than to any school the 
        pupil could attend in the resident district. 
           Sec. 2.  Minnesota Statutes 1996, section 121.904, 
        subdivision 4a, is amended to read: 
           Subd. 4a.  [LEVY RECOGNITION.] (a) "School district tax 
        settlement revenue" means the current, delinquent, and 
        manufactured home property tax receipts collected by the county 
        and distributed to the school district, including distributions 
        made pursuant to section 279.37, subdivision 7, and excluding 
        the amount levied pursuant to section 124.914, subdivision 1. 
           (b) In June of each year, the school district shall 
        recognize as revenue, in the fund for which the levy was made, 
        the lesser of:  
           (1) the May, June, and July school district tax settlement 
        revenue received in that calendar year; or 
           (2) the sum of the state aids and credits enumerated in 
        section 124.155, subdivision 2, which are for the fiscal year 
        payable in that fiscal year plus an amount equal to the levy 
        recognized as revenue in June of the prior year plus 31 percent 
        for fiscal year 1996 and thereafter of the amount of the levy 
        certified in the prior calendar year according to section 
        124A.03, subdivision 2, plus or minus auditor's adjustments, not 
        including levy portions that are assumed by the state; or 
           (3) 18.1 percent for fiscal year 1996, the percent 
        determined under Laws 1996, chapter 461, section 3, for fiscal 
        year 1997 and that same percent thereafter of the amount of the 
        levy certified in the prior calendar year, plus or minus 
        auditor's adjustments, not including levy portions that are 
        assumed by the state, which remains after subtracting, by fund, 
        the amounts levied for the following purposes:  
           (i) reducing or eliminating projected deficits in the 
        reserved fund balance accounts for unemployment insurance and 
        bus purchases; 
           (ii) statutory operating debt pursuant to section 124.914, 
        subdivision 1; 
           (iii) retirement and severance pay pursuant to sections 
        122.531, subdivision 9, 124.2725, subdivision 15, 124.4945, 
        124.912, subdivision 1, and 124.916, subdivision 3, and Laws 
        1975, chapter 261, section 4; 
           (iv) amounts levied for bonds issued and interest thereon, 
        amounts levied for debt service loans and capital loans, amounts 
        levied for down payments under section 124.82, subdivision 3; 
        and 
           (v) amounts levied under section 124.755. 
           Notwithstanding the foregoing, the levy recognition 
        percentage for the referendum levy certified according to 
        section 124A.03, subdivision 2, is 31 percent. 
           (3)(i) 7.0 percent of the lesser of the amount of the 
        general education levy certified in the prior calendar year 
        according to section 124A.23, subdivision 2, or the difference 
        between the amount of the total general fund levy certified in 
        the prior calendar year and the sum of the amounts certified in 
        the prior calendar year according to sections 124A.03, 
        subdivision 2; 124.315, subdivision 4; 124.912, subdivisions 1, 
        paragraph (2), 2, and 3; 124.916, subdivisions 1, 2, and 3, 
        paragraphs (4), (5), and (6); and 124.918, subdivision 6; plus 
           (ii) 31 percent of the referendum levy certified in the 
        prior calendar year according to section 124A.03, subdivision 2; 
        plus 
           (iii) the entire amount of the levy certified in the prior 
        calendar year according to sections 124.315, subdivision 4; 
        124.912, subdivisions 1, paragraph (2), 2, and 3; 124.916, 
        subdivisions 1, 2, and 3, paragraphs (4), (5), and (6); and 
        124.918, subdivision 6. 
           (c) In July of each year, the school district shall 
        recognize as revenue that portion of the school district tax 
        settlement revenue received in that calendar year and not 
        recognized as revenue for the previous fiscal year pursuant to 
        clause (b).  
           (d) All other school district tax settlement revenue shall 
        be recognized as revenue in the fiscal year of the settlement. 
        Portions of the school district levy assumed by the state, 
        including prior year adjustments and the amount to fund the 
        school portion of the reimbursement made pursuant to section 
        273.425, shall be recognized as revenue in the fiscal year 
        beginning in the calendar year for which the levy is payable. 
           Sec. 3.  Minnesota Statutes 1996, section 123.3514, is 
        amended by adding a subdivision to read: 
           Subd. 3a.  [ALTERNATIVE PUPIL.] "Alternative pupil" means 
        an 11th or 12th grade student not enrolled in a public school 
        district, and includes students attending nonpublic schools and 
        students who are home schooled.  An alternative pupil is 
        considered a pupil for purposes of this section only.  An 
        alternative pupil must register with the commissioner of 
        children, families, and learning before participating in the 
        post-secondary enrollment options program.  The commissioner 
        shall prescribe the form and manner of the registration, in 
        consultation with the nonpublic education council under section 
        123.935, subdivision 7, and may request any necessary 
        information from the alternative pupil. 
           Sec. 4.  Minnesota Statutes 1996, section 123.3514, 
        subdivision 4, is amended to read: 
           Subd. 4.  [AUTHORIZATION; NOTIFICATION.] Notwithstanding 
        any other law to the contrary, an 11th or 12th grade pupil 
        enrolled in a public school or an American Indian-controlled 
        tribal contract or grant school eligible for aid under section 
        124.86, except a foreign exchange pupil enrolled in a district 
        under a cultural exchange program, may apply to an eligible 
        institution, as defined in subdivision 3, to enroll in 
        nonsectarian courses offered by that post-secondary 
        institution.  If an institution accepts a secondary pupil for 
        enrollment under this section, the institution shall send 
        written notice to the pupil, the pupil's school or school 
        district, and the commissioner of children, families, and 
        learning within ten days of acceptance.  The notice shall 
        indicate the course and hours of enrollment of that pupil.  If 
        the pupil enrolls in a course for post-secondary credit, the 
        institution shall notify the pupil about payment in the 
        customary manner used by the institution. 
           Sec. 5.  Minnesota Statutes 1996, section 123.3514, 
        subdivision 4a, is amended to read: 
           Subd. 4a.  [COUNSELING.] To the extent possible, the school 
        or school district shall provide counseling services to pupils 
        and their parents or guardian before the pupils enroll in 
        courses under this section to ensure that the pupils and their 
        parents or guardian are fully aware of the risks and possible 
        consequences of enrolling in post-secondary courses.  The school 
        or school district shall provide information on the program 
        including who may enroll, what institutions and courses are 
        eligible for participation, the decision-making process for 
        granting academic credits, financial arrangements for tuition, 
        books and materials, eligibility criteria for transportation 
        aid, available support services, the need to arrange an 
        appropriate schedule, consequences of failing or not completing 
        a course in which the pupil enrolls, the effect of enrolling in 
        this program on the pupil's ability to complete the required 
        high school graduation requirements, and the academic and social 
        responsibilities that must be assumed by the pupils and their 
        parents or guardian.  The person providing counseling shall 
        encourage pupils and their parents or guardian to also use 
        available counseling services at the post-secondary institutions 
        before the quarter or semester of enrollment to ensure that 
        anticipated plans are appropriate.  
           Prior to enrolling in a course, the pupil and the pupil's 
        parents or guardian must sign a form that must be provided by 
        the school or school district and may be obtained from a 
        post-secondary institution stating that they have received the 
        information specified in this subdivision and that they 
        understand the responsibilities that must be assumed in 
        enrolling in this program.  The department of children, 
        families, and learning shall, upon request, provide technical 
        assistance to a school or school district in developing 
        appropriate forms and counseling guidelines. 
           Sec. 6.  Minnesota Statutes 1996, section 123.3514, 
        subdivision 4e, is amended to read: 
           Subd. 4e.  [COURSES ACCORDING TO AGREEMENTS.] An eligible 
        pupil, according to subdivision 4, may enroll in a nonsectarian 
        course taught by a secondary teacher or a post-secondary faculty 
        member and offered at a secondary school, or another location, 
        according to an agreement between a public school board and the 
        governing body of an eligible public post-secondary system or an 
        eligible private post-secondary institution, as defined in 
        subdivision 3.  All provisions of this section shall apply to a 
        pupil, public school board, school district, and the governing 
        body of a post-secondary institution, except as otherwise 
        provided. 
           Sec. 7.  Minnesota Statutes 1996, section 123.3514, 
        subdivision 6c, is amended to read: 
           Subd. 6c.  [FINANCIAL ARRANGEMENTS FOR COURSES PROVIDED 
        ACCORDING TO AGREEMENTS.] (a) The agreement between a public 
        school board and the governing body of a public post-secondary 
        system or private post-secondary institution shall set forth the 
        payment amounts and arrangements, if any, from the public school 
        board to the post-secondary institution.  No payments shall be 
        made by the department of children, families, and learning 
        according to subdivision 6 or 6b.  For the purpose of computing 
        state aids for a school district, a pupil enrolled according to 
        subdivision 4e shall be counted in the average daily membership 
        of the school district as though the pupil were enrolled in a 
        secondary course that is not offered in connection with an 
        agreement.  Nothing in this subdivision shall be construed to 
        prohibit a public post-secondary system or private 
        post-secondary institution from receiving additional state 
        funding that may be available under any other law.  
           (b) If a course is provided under subdivision 4e, offered 
        at a secondary school, and taught by a secondary teacher, the 
        post-secondary system or institution must not require a payment 
        from the school board that exceeds the cost to the 
        post-secondary institution that is directly attributable to 
        providing that course. 
           Sec. 8.  Minnesota Statutes 1996, section 123.3514, is 
        amended by adding a subdivision to read: 
           Subd. 6d.  [ALTERNATIVE PUPILS FINANCIAL ARRANGEMENTS.] For 
        an alternative pupil enrolled in a course or program under this 
        section, the department of children, families, and learning 
        shall make payments to the eligible institution according to 
        subdivision 6.  The department shall not make any payments to a 
        school district for alternative pupils. 
           Sec. 9.  Minnesota Statutes 1996, section 123.3514, is 
        amended by adding a subdivision to read: 
           Subd. 6e.  [TUITION AT NONPUBLIC SECONDARY INSTITUTION.] A 
        nonpublic secondary institution must proportionately adjust its 
        tuition to accurately reflect the time an alternative pupil 
        spends in a post-secondary enrollment course or program. 
           Sec. 10.  Minnesota Statutes 1996, section 123.39, 
        subdivision 6, is amended to read: 
           Subd. 6.  For the purposes of this subdivision, a 
        "nonresident pupil" is a pupil who resides in one district, 
        defined as the "resident district" and attends school in another 
        district, defined as the "nonresident district." 
           If requested, a nonresident district may shall transport a 
        nonresident pupil within its borders and may transport a 
        nonresident pupil within the pupil's resident district.  A 
        nonresident district may not transport a nonresident pupil on a 
        school district owned or contractor operated school bus within 
        the pupil's resident district without the approval of the 
        resident district under section 120.062. 
           The parent or guardian of a nonresident pupil attending a 
        nonresident district under section 120.062 may submit a written 
        request to the resident district asking that the resident 
        district allow the nonresident district to provide 
        transportation for the pupil within the pupil's resident 
        district.  The resident district must approve or disapprove the 
        request, in writing, within 30 days.  The parent or guardian may 
        appeal the refusal of the resident district to the commissioner 
        of children, families, and learning.  The commissioner must act 
        on the appeal within 30 days.  If a nonresident district decides 
        to transport a nonresident pupil within the pupil's resident 
        district, the nonresident district must notify the pupil's 
        resident district of its decision, in writing, prior to 
        providing transportation. 
           Sec. 11.  Minnesota Statutes 1996, section 124.155, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AMOUNT OF ADJUSTMENT.] Each year state 
        aids and credits enumerated in subdivision 2 payable to any 
        school district for that fiscal year shall be adjusted, in the 
        order listed, by an amount equal to (1) the amount the district 
        recognized as revenue for the prior fiscal year pursuant to 
        section 121.904, subdivision 4a, clause (b), minus (2) the 
        amount the district recognizes as revenue for the current fiscal 
        year pursuant to section 121.904, subdivision 4a, clause (b).  
        For the purposes of making the aid adjustment under this 
        subdivision, the amount the district recognizes as revenue for 
        either the prior fiscal year or the current fiscal year pursuant 
        to section 121.904, subdivision 4a, clause (b), shall not 
        include any amount levied pursuant to sections 124.226, 
        subdivision 9, 124.315, subdivision 4, 124.912, subdivisions 1, 
        paragraph (2), 2, and 3, or a successor provision only for those 
        districts affected, 124.916, subdivisions 1 and, 2, and 3, 
        paragraphs 4, 5, and 6, 124.918, subdivision 6, and 124A.03, 
        subdivision 2; and Laws 1992, chapter 499, articles 1, section 
        20, and 6, section 36.  Payment from the permanent school fund 
        shall not be adjusted pursuant to this section.  The school 
        district shall be notified of the amount of the adjustment made 
        to each payment pursuant to this section. 
           Sec. 12.  Minnesota Statutes 1996, section 124.17, 
        subdivision 1d, is amended to read: 
           Subd. 1d.  [AFDC COMPENSATION REVENUE PUPIL UNITS.] AFDC 
        Compensation revenue pupil units for fiscal year 1993 1998 and 
        thereafter must be computed according to this subdivision.  
           (a) The AFDC compensation revenue concentration percentage 
        for each building in a district equals the product of 100 times 
        the ratio of:  
           (1) the sum of the number of pupils enrolled in the 
        district from families receiving aid to families with dependent 
        children according to subdivision 1e building eligible to 
        receive free lunch plus one-half of the pupils eligible to 
        receive reduced priced lunch on October 1 of the previous fiscal 
        year; to 
           (2) the number of pupils in average daily membership 
        according to subdivision 1e enrolled in the district the 
        building on October 1 of the previous fiscal year. 
           (b) The AFDC compensation revenue pupil weighting factor 
        for a district building equals the lesser of one or the quotient 
        obtained by dividing the district's AFDC building's compensation 
        revenue concentration percentage by 11.5 80.0.  
           (c) The AFDC compensation revenue pupil units for a 
        district for fiscal year 1993 and thereafter building equals the 
        product of:  
           (1) the sum of the number of pupils enrolled in the 
        district from families receiving aid to families with dependent 
        children according to subdivision 1e building eligible to 
        receive free lunch and one-half of the pupils eligible to 
        receive reduced priced lunch on October 1 of the previous fiscal 
        year; times 
           (2) the AFDC compensation revenue pupil weighting factor 
        for the district building; times 
           (3) .67 .60. 
           The percentages in this subdivision must be based on the 
        count of individual pupils and not on a building average or 
        minimum. 
           Sec. 13.  Minnesota Statutes 1996, section 124.17, 
        subdivision 4, is amended to read: 
           Subd. 4.  [LEARNING YEAR PUPIL UNITS.] (a) When a pupil is 
        enrolled in a learning year program according to under section 
        121.585, an area learning center according to under sections 
        124C.45 and 124C.46, or an alternative program approved by the 
        commissioner, for more than 1,020 hours in a school year for a 
        secondary student and for, more than 935 hours in a school year 
        for an elementary student, or more than 425 hours in a school 
        year for a kindergarten student without a disability, that pupil 
        may be counted as more than one pupil in average daily 
        membership.  The amount in excess of one pupil must be 
        determined by the ratio of the number of hours of instruction 
        provided to that pupil in excess of:  (i) the greater of 1,020 
        hours or the number of hours required for a full-time secondary 
        pupil in the district to 1,020 for a secondary pupil and of; 
        (ii) the greater of 935 hours or the number of hours required 
        for a full-time elementary pupil in the district to 935 for an 
        elementary pupil in grades 1 through 6; and (iii) the greater of 
        425 hours or the number of hours required for a full-time 
        kindergarten student without a disability in the district to 425 
        for a kindergarten student without a disability.  Hours that 
        occur after the close of the instructional year in June shall be 
        attributable to the following fiscal year.  A kindergarten 
        student must not be counted as more than 1.2 pupils in average 
        daily membership under this subdivision. 
           (b)(i) To receive general education revenue for a pupil in 
        an alternative program that has an independent study component, 
        a school district must meet the requirements in this paragraph.  
        The school district must develop with the pupil a continual 
        learning plan for the pupil.  A district must allow a minor 
        pupil's parent or guardian to participate in developing the 
        plan, if the parent or guardian wants to participate.  The plan 
        must identify the learning experiences and expected outcomes 
        needed for satisfactory credit for the year and for graduation.  
        The plan must be updated each year.  Each school district that 
        has a state-approved public alternative program must reserve 
        revenue in an amount equal to at least 90 percent of the 
        district average general education revenue per pupil unit less 
        compensatory revenue per pupil unit times the number of pupil 
        units generated by students attending a state-approved public 
        alternative program.  The amount of reserved revenue available 
        under this subdivision may only be spent for program costs 
        associated with the state-approved public alternative program.  
        Compensatory revenue must be allocated according to section 
        124A.28, subdivision 1a. 
           (ii) General education revenue for a pupil in an approved 
        alternative program without an independent study component must 
        be prorated for a pupil participating for less than a full year, 
        or its equivalent.  Each school district that has a 
        state-approved public alternative program must reserve revenue 
        in an amount equal to at least 90 percent of the district 
        average general education revenue per pupil unit less 
        compensatory revenue per pupil unit times the number of pupil 
        units generated by students attending a state-approved public 
        alternative program.  The amount of reserved revenue available 
        under this subdivision may only be spent for program costs 
        associated with the state-approved public alternative program.  
        Compensatory revenue must be allocated according to section 
        124A.28, subdivision 1a.  
           (iii) General education revenue for a pupil in an approved 
        alternative program that has an independent study component must 
        be paid for each hour of teacher contact time and each hour of 
        independent study time completed toward a credit or graduation 
        standards necessary for graduation.  Average daily membership 
        for a pupil shall equal the number of hours of teacher contact 
        time and independent study time divided by 1,020. 
           (iv) For an alternative program having an independent study 
        component, the commissioner shall require a description of the 
        courses in the program, the kinds of independent study involved, 
        the expected learning outcomes of the courses, and the means of 
        measuring student performance against the expected outcomes. 
           Sec. 14.  Minnesota Statutes 1996, section 124.17, is 
        amended by adding a subdivision to read: 
           Subd. 6.  [FREE AND REDUCED PRICED LUNCHES.] The 
        commissioner shall determine the number of children eligible to 
        receive either a free or reduced priced lunch on October 1 each 
        year.  The commissioner may use federal definitions for these 
        purposes and may adjust these definitions as appropriate.  The 
        commissioner may adopt reporting guidelines to assure accuracy 
        of data counts and eligibility.  Districts shall use any 
        guidelines adopted by the commissioner. 
           Sec. 15.  Minnesota Statutes 1996, section 124.195, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] (a) The term "other district 
        receipts" means payments by county treasurers pursuant to 
        section 276.10, apportionments from the school endowment fund 
        pursuant to section 124.09, apportionments by the county auditor 
        pursuant to section 124.10, subdivision 2, and payments to 
        school districts by the commissioner of revenue pursuant to 
        chapter 298.  
           (b) The term "cumulative amount guaranteed" means the sum 
        of the following: 
           (1) one-third of the final adjustment payment according to 
        subdivision 6; plus 
           (2) the product of 
           (i) the cumulative disbursement percentage shown in 
        subdivision 3; times 
           (ii) the sum of 
           85 90 percent of the estimated aid and credit entitlements 
        paid according to subdivision 10; plus 
           100 percent of the entitlements paid according to 
        subdivisions 8 and 9; plus 
           the other district receipts; plus 
           the final adjustment payment according to subdivision 6.  
           (c) The term "payment date" means the date on which state 
        payments to school districts are made by the electronic funds 
        transfer method.  If a payment date falls on a Saturday, a 
        Sunday, or a weekday which is a legal holiday, the payment shall 
        be made on the immediately following business day.  The 
        commissioner of children, families, and learning may make 
        payments on dates other than those listed in subdivision 3, but 
        only for portions of payments from any preceding payment dates 
        which could not be processed by the electronic funds transfer 
        method due to documented extenuating circumstances. 
           Sec. 16.  Minnesota Statutes 1996, section 124.195, 
        subdivision 7, is amended to read: 
           Subd. 7.  [PAYMENTS TO SCHOOL NONOPERATING FUNDS.] Each 
        fiscal year state general fund payments for a district 
        nonoperating fund shall be made at 85 90 percent of the 
        estimated entitlement during the fiscal year of the entitlement, 
        unless a higher rate has been established according to section 
        121.904, subdivision 4d.  This amount shall be paid in 12 equal 
        monthly installments.  The amount of the actual entitlement, 
        after adjustment for actual data, minus the payments made during 
        the fiscal year of the entitlement shall be paid prior to 
        October 31 of the following school year.  The commissioner may 
        make advance payments of homestead and agricultural credit aid 
        for a district's debt service fund earlier than would occur 
        under the preceding schedule if the district submits evidence 
        showing a serious cash flow problem in the fund.  The 
        commissioner may make earlier payments during the year and, if 
        necessary, increase the percent of the entitlement paid to 
        reduce the cash flow problem. 
           Sec. 17.  Minnesota Statutes 1996, section 124.195, 
        subdivision 10, is amended to read: 
           Subd. 10.  [AID PAYMENT PERCENTAGE.] Except as provided in 
        subdivisions 8, 9, and 11, each fiscal year, all education aids 
        and credits in this chapter and chapters 121, 123, 124A, 124B, 
        125, 126, 134, and section 273.1392, shall be paid at 90 percent 
        for districts operating a program under section 121.585 for 
        grades 1 to 12 for all students in the district and 85 percent 
        for other districts of the estimated entitlement during the 
        fiscal year of the entitlement, unless a higher rate has been 
        established according to section 121.904, subdivision 4d.  
        Districts operating a program under section 121.585 for grades 1 
        to 12 for all students in the district shall receive 85 percent 
        of the estimated entitlement plus an additional amount of 
        general education aid equal to five percent of the estimated 
        entitlement.  For all districts,.  The final adjustment payment, 
        according to subdivision 6, shall be the amount of the actual 
        entitlement, after adjustment for actual data, minus the 
        payments made during the fiscal year of the entitlement. 
           Sec. 18.  Minnesota Statutes 1996, section 124.195, 
        subdivision 11, is amended to read: 
           Subd. 11.  [NONPUBLIC AIDS.] The state shall pay aid 
        according to sections 123.931 to 123.947 for pupils attending 
        nonpublic schools as follows: 
           (1) an advance payment by November 30 equal to 85 90 
        percent of the estimated entitlement for the current fiscal 
        year; and 
           (2) a final payment by October 31 of the following fiscal 
        year, adjusted for actual data.  
           If a payment advance to meet cash flow needs is requested 
        by a district and approved by the commissioner, the state shall 
        pay basic nonpublic pupil transportation aid according to 
        section 124.225 attributable to pupils attending nonpublic 
        schools by October 31. 
           Sec. 19.  Minnesota Statutes 1996, section 124.225, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DEFINITIONS.] For purposes of this section 
        and section 124.3201, the terms defined in this subdivision have 
        the meanings given to them. 
           (a) "FTE" means a full-time equivalent pupil whose 
        transportation is authorized for aid purposes by section 124.223.
           (b) "Authorized cost for regular transportation" 
        means "Actual expenditure per pupil transported in the regular 
        and excess transportation categories" means the quotient 
        obtained by dividing: 
           (1) the sum of: 
           (1) (i) all expenditures for transportation in the regular 
        category, as defined in paragraph (c) (b), clause (1), for which 
        aid is authorized in section 124.223 and the excess category, as 
        defined in paragraph (b), clause (2), plus 
           (2) (ii) an amount equal to one year's depreciation on the 
        district's school bus fleet and mobile units computed on a 
        straight line basis at the rate of 15 percent per year for 
        districts operating a program under section 121.585 for grades 1 
        to 12 for all students in the district and 12-1/2 percent per 
        year for other districts of the cost of the fleet, plus 
           (3) an amount equal to one year's depreciation on district 
        school buses reconditioned by the department of corrections 
        computed on a straight line basis at the rate of 33-1/3 percent 
        per year of the cost to the district of the reconditioning, plus 
           (4) (iii) an amount equal to one year's depreciation on the 
        district's type three school buses, as defined in section 
        169.01, subdivision 6, clause (5), which must be used a majority 
        of the time for the pupil transportation purposes in sections 
        124.223 and 124.226, subdivisions 5, 8, and 9, and were 
        purchased after July 1, 1982, for authorized transportation of 
        pupils, computed on a straight line basis at the rate of 20 
        percent per year of the cost of the type three school buses by: 
           (2) the number of pupils eligible for transportation in the 
        regular category, as defined in paragraph (b), clause (1), and 
        the excess category, as defined in paragraph (b), clause (2).  
           (c) (b) "Transportation category" means a category of 
        transportation service provided to pupils as follows:  
           (1) Regular transportation is transportation services 
        provided during the regular school year under section 124.223, 
        subdivisions 1 and 2, excluding the following transportation 
        services provided under section 124.223, subdivision 1:  
        transportation between schools; transportation to and from 
        service-learning programs; noon transportation to and from 
        school for kindergarten pupils attending half-day sessions; 
        transportation of pupils to and from schools located outside 
        their normal attendance areas under the provisions of a plan for 
        desegregation mandated by the state board of education or under 
        court order; and transportation of elementary pupils to and from 
        school within a mobility zone.: 
           (i) transportation to and from school during the regular 
        school year for resident elementary pupils residing one mile or 
        more from the public or nonpublic school they attend, and 
        resident secondary pupils residing two miles or more from the 
        public or nonpublic school they attend, excluding desegregation 
        transportation and noon kindergarten transportation; but with 
        respect to transportation of pupils to and from nonpublic 
        schools, only to the extent permitted by sections 123.76 to 
        123.79; 
           (ii) transportation of resident pupils to and from language 
        immersion programs; 
           (iii) transportation of a pupil who is a custodial parent 
        and that pupil's child between the pupil's home and the child 
        care provider and between the provider and the school, if the 
        home and provider are within the attendance area of the school; 
        and 
           (iv) transportation to and from or board and lodging in 
        another district, of resident pupils of a district without a 
        secondary school. 
           For the purposes of this paragraph, a district may 
        designate a licensed day care facility, respite care facility, 
        the residence of a relative, or the residence of a person chosen 
        by the pupil's parent or guardian as the home of a pupil for 
        part or all of the day, if requested by the pupil's parent or 
        guardian, and if that facility or residence is within the 
        attendance area of the school the pupil attends. 
           (2) Nonregular transportation is transportation services 
        provided under section 124.223, subdivision 1, that are excluded 
        from the regular category and transportation services provided 
        under section 124.223, subdivisions 3, 4, 5, 6, 7, 8, 9, and 10. 
           (3) Excess transportation is transportation to and from 
        school during the regular school year for secondary pupils 
        residing at least one mile but less than two miles from the 
        public school they could attend or from the nonpublic school 
        actually attended they attend, and transportation to and from 
        school for pupils residing less than one mile from school who 
        are transported because of extraordinary traffic, drug, or crime 
        hazards. 
           (4) (3) Desegregation transportation is transportation 
        within and outside of the district during the regular school 
        year of pupils to and from schools located outside their normal 
        attendance areas under a plan for desegregation mandated by the 
        state board or under court order.  
           (5) Handicapped transportation is transportation provided 
        under section 124.223, subdivision 4, for pupils with a 
        disability between home or a respite care facility and school or 
        other buildings where special instruction required by sections 
        120.17 and 120.1701 is provided. 
           (4) "Transportation services for pupils with disabilities" 
        is: 
           (i) transportation of pupils with disabilities who cannot 
        be transported on a regular school bus between home or a respite 
        care facility and school; 
           (ii) necessary transportation of pupils with disabilities 
        from home or from school to other buildings, including centers 
        such as developmental achievement centers, hospitals, and 
        treatment centers where special instruction or services required 
        by sections 120.17 and 120.1701 are provided, within or outside 
        the district where services are provided; 
           (iii) necessary transportation for resident pupils with 
        disabilities required by sections 120.17, subdivision 4a, and 
        120.1701; 
           (iv) board and lodging for pupils with disabilities in a 
        district maintaining special classes; 
           (v) transportation from one educational facility to another 
        within the district for resident pupils enrolled on a 
        shared-time basis in educational programs, and necessary 
        transportation required by sections 120.17, subdivision 9, and 
        120.1701, for resident pupils with disabilities who are provided 
        special instruction and services on a shared-time basis; 
           (vi) transportation for resident pupils with disabilities 
        to and from board and lodging facilities when the pupil is 
        boarded and lodged for educational purposes; and 
           (vii) services described in clauses (i) to (vi), when 
        provided for pupils with disabilities in conjunction with a 
        summer instructional program that relates to the pupil's 
        individual education plan or in conjunction with a learning year 
        program established under section 121.585. 
           (5) "Nonpublic nonregular transportation" is: 
           (i) transportation from one educational facility to another 
        within the district for resident pupils enrolled on a 
        shared-time basis in educational programs, excluding 
        transportation for nonpublic pupils with disabilities under 
        clause (4); 
           (ii) transportation within district boundaries between a 
        nonpublic school and a public school or a neutral site for 
        nonpublic school pupils who are provided pupil support services 
        pursuant to section 123.935; and 
           (iii) late transportation home from school or between 
        schools within a district for nonpublic school pupils involved 
        in after-school activities. 
           (d) (c) "Mobile unit" means a vehicle or trailer designed 
        to provide facilities for educational programs and services, 
        including diagnostic testing, guidance and counseling services, 
        and health services.  A mobile unit located off nonpublic school 
        premises is a neutral site as defined in section 123.932, 
        subdivision 9. 
           (e) "Current year" means the school year for which aid will 
        be paid.  
           (f) "Base year" means the second school year preceding the 
        school year for which aid will be paid.  
           (g) "Base cost" means the ratio of: 
           (1) the sum of the authorized cost in the base year for 
        regular transportation as defined in paragraph (b) plus the 
        actual cost in the base year for excess transportation as 
        defined in paragraph (c); 
           (2) to the sum of the number of weighted FTE's in the 
        regular and excess categories in the base year. 
           (h) "Pupil weighting factor" for the excess transportation 
        category for a school district means the lesser of one, or the 
        result of the following computation: 
           (1) Divide the square mile area of the school district by 
        the number of FTE's in the regular and excess categories in the 
        base year. 
           (2) Raise the result in clause (1) to the one-fifth power. 
           (3) Divide four-tenths by the result in clause (2). 
           The pupil weighting factor for the regular transportation 
        category is one.  
           (i) "Weighted FTE's"  means the number of FTE's in each 
        transportation category multiplied by the pupil weighting factor 
        for that category. 
           (j) "Sparsity index" for a school district means the 
        greater of .005 or the ratio of the square mile area of the 
        school district to the sum of the number of weighted FTE's by 
        the district in the regular and excess categories in the base 
        year. 
           (k) "Density index" for a school district means the greater 
        of one or the result obtained by subtracting the product of the 
        district's sparsity index times 20 from two. 
           (l) "Contract transportation index" for a school district 
        means the greater of one or the result of the following 
        computation: 
           (1) Multiply the district's sparsity index by 20. 
           (2) Select the lesser of one or the result in clause (1). 
           (3) Multiply the district's percentage of regular FTE's in 
        the current year using vehicles that are not owned by the school 
        district by the result in clause (2). 
           (m) "Adjusted predicted base cost" means the predicted base 
        cost as computed in subdivision 3a as adjusted under subdivision 
        7a. 
           (n) "Regular transportation allowance" means the adjusted 
        predicted base cost, inflated and adjusted under subdivision 7b. 
           Sec. 20.  Minnesota Statutes 1996, section 124.225, 
        subdivision 13, is amended to read: 
           Subd. 13.  [TARGETED NEEDS TRANSPORTATION REVENUE.] A 
        district's targeted needs transportation revenue for the 
        1996-1997 and later 1997-1998 school years equals the sum of the 
        special programs transportation revenue according to subdivision 
        14, the integration transportation revenue according to 
        subdivision 15, and the nonpublic pupil transportation revenue 
        aid according to subdivision 16. 
           Sec. 21.  Minnesota Statutes 1996, section 124.225, 
        subdivision 14, is amended to read: 
           Subd. 14.  [SPECIAL PROGRAMS TRANSPORTATION REVENUE.] A 
        district's special programs transportation revenue for the 
        1996-1997 and later 1997-1998 school years equals the sum of: 
           (a) the district's actual cost in the base year for 
        transportation services for children with disabilities under 
        section 124.223, subdivisions 4, 5, 7, and 8 subdivision 1, 
        paragraph (b), clause (4), times the ratio of the district's 
        average daily membership for the current school year to the 
        district's average daily membership for the base year; plus 
           (b) the greater of zero or 80 percent of the difference 
        between: 
           (1) the district's actual cost in the current year for 
        transportation services for children with disabilities under 
        section 124.223, subdivisions 4, 5, 7, and 8 subdivision 1, 
        paragraph (b), clause (4); and 
           (2) the amount computed in paragraph (a). 
           Sec. 22.  Minnesota Statutes 1996, section 124.225, 
        subdivision 15, is amended to read: 
           Subd. 15.  [INTEGRATION TRANSPORTATION REVENUE.] A 
        district's integration transportation revenue for the 1996-1997 
        and later 1997-1998 school years equals the following amounts: 
           (a) for independent school district No. 709, Duluth, $4 
        times the actual pupil units for the school year; 
           (b) for independent school district No. 625, St. Paul, $73 
        times the actual pupil units for the school year; and 
           (c) for special school district No. 1, Minneapolis, $158 
        times the actual pupil units for the school year. 
           Sec. 23.  Minnesota Statutes 1996, section 124.225, 
        subdivision 16, is amended to read: 
           Subd. 16.  [NONPUBLIC PUPIL TRANSPORTATION REVENUE AID.] 
        (a) A district's nonpublic pupil transportation revenue aid for 
        the 1996-1997 and later school years for transportation services 
        for nonpublic school pupils according to sections 123.39, 123.76 
        to 123.78, 124.223, and 124.226 this section, equals the sum of 
        the amounts computed in paragraphs (b) and (c).  This revenue 
        aid does not limit the obligation to transport pupils under 
        sections 123.76 to 123.79. 
           (b) For regular and excess transportation according to 
        section 124.225, subdivision 1, paragraph (c) (b), clauses (1) 
        and (3) (2), an amount equal to the product of: 
           (1) the district's actual expenditure per pupil transported 
        in the regular and excess transportation categories during the 
        second preceding school year; times 
           (2) the number of nonpublic school pupils residing in the 
        district who receive regular or excess transportation service or 
        reimbursement for the current school year; times 
           (3) the ratio of the formula allowance pursuant to section 
        124A.22, subdivision 2, for the current school year to the 
        formula allowance pursuant to section 124A.22, subdivision 2, 
        for the second preceding school year. 
           (c) For nonpublic nonregular transportation according to 
        section 124.225, subdivision 1, paragraph (c) (b), 
        clause (2) (5), excluding transportation services for children 
        with disabilities under section 124.223, subdivisions 4, 5, 7, 
        and 8, and late activity transportation according to section 
        124.226, subdivision 9, an amount equal to the product of: 
           (1) the district's actual expenditure for nonpublic 
        nonregular and late activity transportation for nonpublic school 
        pupils during the second preceding school year; times 
           (2) the ratio of the formula allowance pursuant to section 
        124A.22, subdivision 2, for the current school year to the 
        formula allowance pursuant to section 124A.22, subdivision 2, 
        for the second preceding school year. 
           (d) Notwithstanding the amount of the formula allowance for 
        fiscal years 1997 and 1998 in section 124A.22, subdivision 2, 
        the commissioner shall use the amount of the formula 
        allowance for the current year less $300 in determining the 
        nonpublic pupil transportation revenue in paragraphs (b) and (c) 
        for fiscal years 1997 and 1998. 
           Sec. 24.  Minnesota Statutes 1996, section 124.225, 
        subdivision 17, is amended to read: 
           Subd. 17.  [TARGETED NEEDS TRANSPORTATION AID.] (a) For 
        fiscal years 1997 and 1998, a district's targeted needs 
        transportation aid is the difference between its targeted needs 
        transportation revenue under subdivision 13 and its targeted 
        needs transportation levy under section 124.226, subdivision 10. 
           (b) If a district does not levy the entire amount 
        permitted, aid must be reduced in proportion to the actual 
        amount levied. 
           Sec. 25.  Minnesota Statutes 1996, section 124.226, 
        subdivision 10, is amended to read: 
           Subd. 10.  [TARGETED NEEDS TRANSPORTATION LEVY.] A school 
        district may make a levy for targeted needs transportation costs 
        according to this subdivision.  The amount of the levy shall be 
        the result of the following computation: 
           (1) For fiscal year years 1997 and later 1998, targeted 
        needs transportation levy equalization revenue equals 28 percent 
        of the sum of the district's special programs transportation 
        revenue under section 124.225, subdivision 14, and the 
        district's integration transportation revenue under section 
        124.225, subdivision 15. 
           (2) The targeted needs transportation levy equals the 
        result in clause (1) times the lesser of one or the ratio of (i) 
        the quotient derived by dividing the adjusted net tax capacity 
        of the district for the year before the year the levy is 
        certified by the actual pupil units in the district for the 
        school year to which the levy is attributable, to (ii) $3,540. 
           Sec. 26.  Minnesota Statutes 1996, section 124.912, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [STATUTORY OBLIGATIONS.] (a) A school 
        district may levy: 
           (1) the amount authorized for liabilities of dissolved 
        districts pursuant to section 122.45; 
           (2) the amounts necessary to pay the district's obligations 
        under section 268.06, subdivision 25; and the amounts necessary 
        to pay for job placement services offered to employees who may 
        become eligible for benefits pursuant to section 268.08 for the 
        fiscal year the levy is certified; 
           (3) the amounts necessary to pay the district's obligations 
        under section 127.05; 
           (4) the amounts authorized by section 122.531; 
           (5) the amounts necessary to pay the district's obligations 
        under section 122.533; and 
           (6) for severance pay required by sections 120.08, 
        subdivision 3, and 122.535, subdivision 6. 
           (b) Each year, a member district of an education district 
        that levies under this subdivision must transfer the amount of 
        revenue certified under paragraph (b) to the education district 
        board according to this subdivision.  By June 20 and November 30 
        of each year, an amount must be transferred equal to: 
           (1) 50 percent times 
           (2) the amount certified in paragraph (b) minus homestead 
        and agricultural credit aid allocated for that levy according to 
        section 273.1398, subdivision 6. 
           Sec. 27.  Minnesota Statutes 1996, section 124.912, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DESEGREGATION.] Each year, special school 
        district No. 1, Minneapolis, may levy an amount not to exceed 
        $197 times its actual pupil units for that fiscal year; 
        independent school district No. 625, St. Paul, may levy an 
        amount not to exceed $197 times its actual pupil units for that 
        fiscal year; and independent school district No. 709, Duluth, 
        may levy an amount not to exceed the sum of $660,000 and the 
        amount raised by a tax rate of 2.0 percent times the adjusted 
        net tax capacity of the district.  Notwithstanding section 
        121.904, the entire amount of this levy shall be recognized as 
        revenue for the fiscal year in which the levy is certified.  
        This levy shall not be considered in computing the aid reduction 
        under section 124.155. 
           Sec. 28.  Minnesota Statutes 1996, section 124.912, 
        subdivision 3, is amended to read: 
           Subd. 3.  [RULE COMPLIANCE.] Each year a district that is 
        required to implement a plan according to the requirements of 
        Minnesota Rules, parts 3535.0200 to 3535.2200, may levy an 
        amount not to exceed a net tax rate of 2.0 percent times the 
        adjusted net tax capacity of the district for taxes payable in 
        1991 and thereafter.  A district that levies according to 
        subdivision 2 may not levy according to this subdivision.  
        Notwithstanding section 121.904, the entire amount of this levy 
        shall be recognized as revenue for the fiscal year in which the 
        levy is certified.  This levy shall not be considered in 
        computing the aid reduction under section 124.155.  
           Sec. 29.  Minnesota Statutes 1996, section 124.916, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [HEALTH INSURANCE.] (a) A school district 
        may levy the amount necessary to make employer contributions for 
        insurance for retired employees under this 
        subdivision.  Notwithstanding section 121.904, 50 percent of the 
        amount levied shall be recognized as revenue for the fiscal year 
        in which the levy is certified.  This levy shall not be 
        considered in computing the aid reduction under section 124.155. 
           (b) The school board of a joint vocational technical 
        district formed under sections 136C.60 to 136C.69 and the school 
        board of a school district may provide employer-paid hospital, 
        medical, and dental benefits to a person who: 
           (1) is eligible for employer-paid insurance under 
        collective bargaining agreements or personnel plans in effect on 
        June 30, 1992; 
           (2) has at least 25 years of service credit in the public 
        pension plan of which the person is a member on the day before 
        retirement or, in the case of a teacher, has a total of at least 
        25 years of service credit in the teachers retirement 
        association, a first-class city teacher retirement fund, or any 
        combination of these; 
           (3) upon retirement is immediately eligible for a 
        retirement annuity; 
           (4) is at least 55 and not yet 65 years of age; and 
           (5) retires on or after May 15, 1992, and before July 21, 
        1992. 
           A school board paying insurance under this subdivision may 
        not exclude any eligible employees. 
           (c) An employee who is eligible both for the health 
        insurance benefit under this subdivision and for an early 
        retirement incentive under a collective bargaining agreement or 
        personnel plan established by the employer must select either 
        the early retirement incentive provided under the collective 
        bargaining agreement personnel plan or the incentive provided 
        under this subdivision, but may not receive both.  For purposes 
        of this subdivision, a person retires when the person terminates 
        active employment and applies for retirement benefits.  The 
        retired employee is eligible for single and dependent coverages 
        and employer payments to which the person was entitled 
        immediately before retirement, subject to any changes in 
        coverage and employer and employee payments through collective 
        bargaining or personnel plans, for employees in positions 
        equivalent to the position from which the employee retired.  The 
        retired employee is not eligible for employer-paid life 
        insurance.  Eligibility ceases when the retired employee attains 
        the age of 65, or when the employee chooses not to receive the 
        retirement benefits for which the employee has applied, or when 
        the employee is eligible for employer-paid health insurance from 
        a new employer.  Coverages must be coordinated with relevant 
        health insurance benefits provided through the federally 
        sponsored Medicare program.  
           (d) Unilateral implementation of this section by a public 
        employer is not an unfair labor practice for purposes of chapter 
        179A.  The authority provided in this subdivision for an 
        employer to pay health insurance costs for certain retired 
        employees is not subject to the limits in section 179A.20, 
        subdivision 2a. 
           (e) If a school district levies according to this 
        subdivision, it may not also levy according to section 122.531, 
        subdivision 9, for eligible employees. 
           Sec. 30.  Minnesota Statutes 1996, section 124.916, 
        subdivision 2, is amended to read: 
           Subd. 2.  [RETIRED EMPLOYEE HEALTH BENEFITS.] For taxes 
        payable in 1996, 1997, 1998, and 1999 only, a school district 
        may levy an amount up to the amount the district is required by 
        the collective bargaining agreement in effect on March 30, 1992, 
        to pay for health insurance or unreimbursed medical expenses for 
        licensed and nonlicensed employees who have terminated services 
        in the employing district and withdrawn from active teaching 
        service or other active service, as applicable, before July 1, 
        1992.  The total amount of the levy each year may not exceed 
        $300,000.  
           Notwithstanding section 121.904, 50 percent of the proceeds 
        of this levy shall be recognized in the fiscal year in which it 
        is certified. 
           Sec. 31.  Minnesota Statutes 1996, section 124.916, 
        subdivision 3, is amended to read: 
           Subd. 3.  [RETIREMENT LEVIES.] (1) In addition to the 
        excess levy authorized in 1976 any district within a city of the 
        first class which was authorized in 1975 to make a retirement 
        levy under Minnesota Statutes 1974, section 275.127 and chapter 
        422A may levy an amount per pupil unit which is equal to the 
        amount levied in 1975 payable 1976, under Minnesota Statutes 
        1974, section 275.127 and chapter 422A, divided by the number of 
        pupil units in the district in 1976-1977. 
           (2) In 1979 and each year thereafter, any district which 
        qualified in 1976 for an extra levy under paragraph (1) shall be 
        allowed to levy the same amount as levied for retirement in 1978 
        under this clause reduced each year by ten percent of the 
        difference between the amount levied for retirement in 1971 
        under Minnesota Statutes 1971, sections 275.127 and 422.01 to 
        422.54 and the amount levied for retirement in 1975 under 
        Minnesota Statutes 1974, section 275.127 and chapter 422A. 
           (3) In 1991 and each year thereafter, a district to which 
        this subdivision applies may levy an additional amount required 
        for contributions to the Minneapolis employees retirement fund 
        as a result of the maximum dollar amount limitation on state 
        contributions to the fund imposed under section 422A.101, 
        subdivision 3.  The additional levy shall not exceed the most 
        recent amount certified by the board of the Minneapolis 
        employees retirement fund as the district's share of the 
        contribution requirement in excess of the maximum state 
        contribution under section 422A.101, subdivision 3.  
           (4) For taxes payable in 1994 and thereafter, special 
        school district No. 1, Minneapolis, and independent school 
        district No. 625, St. Paul, may levy for the increase in the 
        employer retirement fund contributions, under Laws 1992, chapter 
        598, article 5, section 1.  Notwithstanding section 121.904, the 
        entire amount of this levy may be recognized as revenue for the 
        fiscal year in which the levy is certified.  This levy shall not 
        be considered in computing the aid reduction under section 
        124.155. 
           (5) If the employer retirement fund contributions under 
        section 354A.12, subdivision 2a, are increased for fiscal year 
        1994 or later fiscal years, special school district No. 1, 
        Minneapolis, and independent school district No. 625, St. Paul, 
        may levy in payable 1994 or later an amount equal to the amount 
        derived by applying the net increase in the employer retirement 
        fund contribution rate of the respective teacher retirement fund 
        association between fiscal year 1993 and the fiscal year 
        beginning in the year after the levy is certified to the total 
        covered payroll of the applicable teacher retirement fund 
        association.  Notwithstanding section 121.904, the entire amount 
        of this levy may be recognized as revenue for the fiscal year in 
        which the levy is certified.  This levy shall not be considered 
        in computing the aid reduction under section 124.155.  If an 
        applicable school district levies under this paragraph, they may 
        not levy under paragraph (4). 
           (6) In addition to the levy authorized under paragraph (5), 
        special school district No. 1, Minneapolis, may also levy 
        payable in 1997 or later an amount equal to the contributions 
        under section 423A.02, subdivision 3, and may also levy in 
        payable 1994 or later an amount equal to the state aid 
        contribution under section 354A.12, subdivision 3b.  Independent 
        school district No. 625, St. Paul, may levy payable in 1997 or 
        later an amount equal to the supplemental contributions under 
        section 423A.02, subdivision 3.  Notwithstanding section 
        121.904, the entire amount of these levies may be recognized as 
        revenue for the fiscal year in which the levy is certified.  
        These levies shall not be considered in computing the aid 
        reduction under section 124.155. 
           Sec. 32.  Minnesota Statutes 1996, section 124.918, 
        subdivision 6, is amended to read: 
           Subd. 6.  [ADJUSTMENTS FOR LAW CHANGES.] Whenever a change 
        enacted in law changes the levy authority for a school district 
        or an intermediate school district for a fiscal year after the 
        levy for that fiscal year has been certified by the district 
        under section 275.07, the department of children, families, and 
        learning shall adjust the next levy certified by the district by 
        the amount of the change in levy authority for that fiscal year 
        resulting from the change.  Notwithstanding section 121.904, the 
        entire amount for fiscal year 1992 and 50 percent for fiscal 
        years thereafter of the levy adjustment must be recognized as 
        revenue in the fiscal year the levy is certified, if sufficient 
        levy resources are available under generally accepted accounting 
        principles in the district fund where the adjustment is to 
        occur.  School districts that do not have sufficient levy 
        resources available in the fund where the adjustment is to occur 
        shall recognize in the fiscal year the levy is certified an 
        amount equal to the levy resources available.  The remaining 
        adjustment amount shall be recognized as revenue in the fiscal 
        year after the levy is certified. 
           Sec. 33.  Minnesota Statutes 1996, section 124A.03, 
        subdivision 1c, is amended to read: 
           Subd. 1c.  [REFERENDUM ALLOWANCE LIMIT.] Notwithstanding 
        subdivision 1b, a district's referendum allowance must not 
        exceed the greater of:  
           (1) the district's referendum allowance for fiscal year 
        1994; or 
           (2) 25 percent of the formula allowance minus $300 for 
        fiscal year 1997 and later; or 
           (3) for a newly reorganized district created after July 1, 
        1994, the sum of the referendum revenue authority for the 
        reorganizing districts for the fiscal year preceding the 
        reorganization, divided by the sum of the actual pupil units of 
        the reorganizing districts for the fiscal year preceding the 
        reorganization. 
           Sec. 34.  Minnesota Statutes 1996, section 124A.03, 
        subdivision 1g, is amended to read: 
           Subd. 1g.  [REFERENDUM EQUALIZATION LEVY.] (a) For fiscal 
        year 1996, a district's referendum equalization levy equals the 
        district's referendum equalization revenue times the lesser of 
        one or the ratio of the district's adjusted net tax capacity per 
        actual pupil unit to 100 percent of the equalizing factor as 
        defined in section 124A.02, subdivision 8. 
           (b) For fiscal year 1997 1999 and thereafter, a district's 
        referendum equalization levy for a referendum levied against the 
        referendum market value of all taxable property as defined in 
        section 124A.02, subdivision 3b, equals the district's 
        referendum equalization revenue times the lesser of one or the 
        ratio of the district's referendum market value per actual pupil 
        unit to $476,000. 
           (c) (b) For fiscal year 1997 1999 and thereafter, a 
        district's referendum equalization levy for a referendum levied 
        against the net tax capacity of all taxable property equals the 
        district's referendum equalization revenue times the lesser of 
        one or the ratio of the district's adjusted net tax capacity per 
        actual pupil unit to 100 percent of the equalizing factor for 
        that year $10,000. 
           Sec. 35.  Minnesota Statutes 1996, section 124A.04, 
        subdivision 2, is amended to read: 
           Subd. 2.  [1993 1999 AND LATER.] The training and 
        experience index for fiscal year 1999 and later must be 
        constructed in the following manner:  
           (a) The department shall construct a matrix that classifies 
        teachers by the extent of training received in accredited 
        institutions of higher education and by the years of experience 
        that districts take into account in determining teacher salaries.
           (b) The average salary for each cell of the matrix must be 
        computed as follows using data from the second year of the 
        previous biennium fiscal year 1997:  
           (1) For each school district, multiply the salary paid to 
        full-time equivalent teachers with that combination of training 
        and experience according to the district's teacher salary 
        schedule by the number of actual pupil units in that district.  
           (2) Add the amounts computed in clause (1) for all 
        districts in the state and divide the resulting sum by the total 
        number of actual pupil units in all districts in the state that 
        employ teachers.  
           (c) For each cell in the matrix, compute the ratio of the 
        average salary in that cell to the average salary for all 
        teachers in the state during fiscal year 1997.  
           (d) The index for each district that employs teachers 
        equals the sum of:  (i) for teachers employed in that district 
        during fiscal year 1997 and the current fiscal year, the ratios 
        for each teacher computed using data for fiscal year 1997; and 
        (ii) for teachers employed in that district during the current 
        fiscal year but not during fiscal year 1997, the ratio for 
        teachers who are in their first year of teaching and who have no 
        additional credits or degrees above a bachelor's degree divided 
        by the number of teachers in that district.  The index for a 
        district that employs no teachers is zero. 
           Sec. 36.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GENERAL EDUCATION REVENUE.] (a) For fiscal 
        year 1996, the general education revenue for each district 
        equals the sum of the district's basic revenue, compensatory 
        education revenue, training and experience revenue, secondary 
        sparsity revenue, elementary sparsity revenue, and supplemental 
        revenue. 
           (b) For fiscal year years 1997 and thereafter 1998, the 
        general education revenue for each district equals the sum of 
        the district's basic revenue, compensatory education revenue, 
        secondary sparsity revenue, elementary sparsity revenue, 
        transportation sparsity revenue, total operating capital 
        revenue, transition revenue, and supplemental revenue. 
           (b) For fiscal year 1999 and thereafter, the general 
        education revenue for each district equals the sum of the 
        district's basic revenue, basic skills revenue, training and 
        experience revenue, secondary sparsity revenue, elementary 
        sparsity revenue, transportation sparsity revenue, total 
        operating capital revenue, transition revenue, and supplemental 
        revenue. 
           Sec. 37.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 2, as amended by Laws 1997, chapter 1, section 4, is 
        amended to read: 
           Subd. 2.  [BASIC REVENUE.] The basic revenue for each 
        district equals the formula allowance times the actual pupil 
        units for the school year.  The formula allowance for fiscal 
        year 1995 is $3,150.  The formula allowance for fiscal year 1996 
        is $3,205.  The formula allowance for fiscal year 1997 and 
        subsequent fiscal years is $3,505.  The formula allowance for 
        fiscal year 1998 is $3,581 and the formula allowance for fiscal 
        year 1999 and subsequent fiscal years is $3,530. 
           Sec. 38.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 3, is amended to read: 
           Subd. 3.  [COMPENSATORY EDUCATION REVENUE.] The 
        compensatory education revenue for each building in the district 
        equals the formula allowance less $300 times the AFDC 
        compensation revenue pupil units computed according to section 
        124.17, subdivision 1d.  Revenue shall be paid to the district 
        and must be allocated according to section 124A.28, subdivision 
        1a. 
           Sec. 39.  Minnesota Statutes 1996, section 124A.22, is 
        amended by adding a subdivision to read: 
           Subd. 3a.  [BASIC SKILLS REVENUE.] For fiscal year 1999 and 
        thereafter, a school district's basic skills revenue equals the 
        sum of: 
           (1) compensatory revenue under subdivision 3; plus 
           (2) limited English proficiency revenue according to 
        section 124.273, subdivision 1g; plus 
           (3) $190 times the limited English proficiency pupil units 
        according to section 124.17, subdivision 7; plus 
           (4) the lesser of:  (i) $22.50 times the number of fund 
        balance pupil units in kindergarten to grade 8; or (ii) the 
        amount of district money provided to match basic skills revenue 
        for the purposes described in section 124A.28. 
           Sec. 40.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 6, is amended to read: 
           Subd. 6.  [SECONDARY SPARSITY REVENUE.] (a) A district's 
        secondary sparsity revenue for a school year equals the sum of 
        the results of the following calculation for each qualifying 
        high school in the district: 
           (1) the formula allowance for the school year less $300, 
        multiplied by 
           (2) the secondary average daily membership of the high 
        school, multiplied by 
           (3) the quotient obtained by dividing 400 minus the 
        secondary average daily membership by 400 plus the secondary 
        daily membership, multiplied by 
           (4) the lesser of 1.5 or the quotient obtained by dividing 
        the isolation index minus 23 by ten. 
           (b) A newly formed school district that is the result of 
        districts combining under the cooperation and combination 
        program or consolidating under section 122.23 shall receive 
        secondary sparsity revenue equal to the greater of:  (1) the 
        amount calculated under paragraph (a) for the combined district; 
        or (2) the sum of the amounts of secondary sparsity revenue the 
        former school districts had in the year prior to consolidation, 
        increased for any subsequent changes in the secondary sparsity 
        formula. 
           Sec. 41.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 6a, is amended to read: 
           Subd. 6a.  [ELEMENTARY SPARSITY REVENUE.] A district's 
        elementary sparsity revenue equals the sum of the following 
        amounts for each qualifying elementary school in the district:  
           (1) the formula allowance for the year less $300, 
        multiplied by 
           (2) the elementary average daily membership of the school, 
        multiplied by 
           (3) the quotient obtained by dividing 140 minus the 
        elementary average daily membership by 140 plus the average 
        daily membership. 
           Sec. 42.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 8a, is amended to read: 
           Subd. 8a.  [SUPPLEMENTAL LEVY.] To obtain supplemental 
        revenue, a district may levy an amount not more than the product 
        of its supplemental revenue for the school year times the lesser 
        of one or the ratio of its general education levy to its general 
        education revenue, excluding transition revenue and supplemental 
        revenue, for the same year adjusted net tax capacity per actual 
        pupil unit to $10,000. 
           Sec. 43.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 13, is amended to read: 
           Subd. 13.  [TRANSPORTATION SPARSITY DEFINITIONS.] The 
        definitions in this subdivision apply to subdivisions 13a and 
        13b. 
           (a) "Sparsity index" for a school district means the 
        greater of .2 or the ratio of the square mile area of the school 
        district to the actual pupil units of the school district. 
           (b) "Density index" for a school district means the ratio 
        of the square mile area of the school district to the actual 
        pupil units of the school district.  However, the density index 
        for a school district cannot be greater than .2 or less than 
        .005. 
           (c) "Fiscal year 1996 base allowance" for a school district 
        means the result of the following computation: 
           (1) sum the following amounts: 
           (i) the fiscal year 1996 regular transportation revenue for 
        the school district according to section 124.225, subdivision 
        7d, paragraph (a), excluding the revenue attributable nonpublic 
        school pupils and to pupils with disabilities receiving special 
        transportation services; plus 
           (ii) the fiscal year 1996 nonregular transportation revenue 
        for the school district according to section 124.225, 
        subdivision 7d, paragraph (b), excluding the revenue for 
        desegregation transportation according to section 124.225, 
        subdivision 1, paragraph (c), clause (4), and the revenue 
        attributable to nonpublic school pupils and to pupils with 
        disabilities receiving special transportation services or board 
        and lodging; plus 
           (iii) the fiscal year 1996 excess transportation levy for 
        the school district according to section 124.226, subdivision 5, 
        excluding the levy attributable to nonpublic school pupils; plus 
           (iv) the fiscal year 1996 late activity bus levy for the 
        school district according to section 124.226, subdivision 9, 
        excluding the levy attributable to nonpublic school pupils; plus 
           (v) an amount equal to one-third of the fiscal year 1996 
        bus depreciation for the school district according to section 
        124.225, subdivision 1, paragraph (b), clauses (2), (3), and (4).
           (2) divide the result in clause (1) by the school districts 
        district's 1995-1996 actual fund balance pupil units. 
           Sec. 44.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 13b, is amended to read: 
           Subd. 13b.  [TRANSITION ALLOWANCE.] (a) A district's 
        transportation transition allowance for fiscal year 1997 equals 
        the result of the following computation: 
           (1) if the result in subdivision 13a, paragraph (a), clause 
        (iii), for fiscal year 1997 is less than the fiscal year 1996 
        base allowance, the transportation transition allowance equals 
        the fiscal year 1996 base allowance minus the result in 
        subdivision 13a, paragraph (a), clause (iii). 
           (2) if the result in subdivision 13a, paragraph (b), for 
        fiscal year 1997 is greater than the fiscal year 1996 base 
        allowance and less than 110 percent of the fiscal year 1996 base 
        allowance, the transportation transition allowance equals zero. 
           (3) if the result in subdivision 13a, paragraph (b), for 
        fiscal year 1997 is greater than 110 percent of the fiscal year 
        1996 base allowance, the transportation transition allowance 
        equals 110 percent of the fiscal year 1996 base allowance minus 
        the result in subdivision 13a, paragraph (a), clause (iii). 
           (b) A district's transportation transition allowance for 
        fiscal year 1998 and later equals the result of the following: 
           (1) if the result in subdivision 13a, paragraph (a), clause 
        (iii), for fiscal year 1998 is less than the fiscal year 1996 
        base allowance, the transportation transition allowance equals 
        the fiscal year 1996 base allowance minus the result in 
        subdivision 13a, paragraph (a), clause (iii); or 
           (2) if the result in subdivision 13a, paragraph (a), clause 
        (iii), for fiscal year 1998 and later is greater than or equal 
        to the fiscal year 1996 base allowance, the transportation 
        transition allowance equals zero. 
           (c) (b) For fiscal years 1997 and 1998, a district's 
        training and experience transition allowance is equal to the 
        training and experience revenue the district would have received 
        under Minnesota Statutes 1994, section 124A.22, subdivision 4, 
        divided by the actual pupil units for fiscal year 1997 minus 
        $130.  For fiscal year 1999 and later, a district's training and 
        experience transition allowance equals zero.  
           If the training and experience transition allowance is less 
        than zero, the reduction shall be determined according to the 
        following schedule: 
           (i) (1) for fiscal year 1997, the reduction is equal to .9 
        times the amount initially determined; 
           (ii) (2) for fiscal year 1998, the reduction is equal to 
        .75 times the amount initially determined; and 
           (iii) for fiscal year 1999, the reduction is equal to .50 
        times the amount initially determined; 
           (iv) for fiscal year 2000, the reduction is equal to .25 
        times the amount initially determined; and 
           (v) for fiscal year 2001 and thereafter, the transition 
        allowance shall not be less than zero 
           (c) A district's transition compensatory allowance equals 
        the greater of zero or the difference between:  
           (1) the amount of compensatory revenue the district would 
        have received under subdivision 3 for fiscal year 1998 computed 
        using a basic formula allowance of $3,281; and 
           (2) the amount the district receives under subdivision 3; 
        divided by 
           (3) the district's actual pupil units for fiscal year 1998. 
           (d) A district's transition allowance for fiscal year 1997 
        and thereafter 1998 is equal to the sum of its transportation 
        transition allowance and, its training and experience transition 
        allowance, and its transition compensatory allowance.  A 
        district's transition allowance for fiscal year 1999 and 
        thereafter is equal to the sum of its transportation transition 
        allowance and its transition compensatory allowance. 
           Sec. 45.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 13d, is amended to read: 
           Subd. 13d.  [TRANSITION LEVY ADJUSTMENT.] A district's 
        general education levy shall be adjusted by an amount equal to 
        the district's transition revenue times the lesser of 1 or the 
        ratio of the district's general education levy to its general 
        education revenue, excluding transition revenue and supplemental 
        revenue its adjusted net tax capacity per actual pupil unit to 
        $10,000. 
           Sec. 46.  Minnesota Statutes 1996, section 124A.23, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GENERAL EDUCATION TAX RATE.] The 
        commissioner shall establish the general education tax rate by 
        July 1 of each year for levies payable in the following year.  
        The general education tax capacity rate shall be a rate, rounded 
        up to the nearest tenth hundredth of a percent, that, when 
        applied to the adjusted net tax capacity for all districts, 
        raises the amount specified in this subdivision.  The general 
        education tax rate shall be the rate that raises $1,054,000,000 
        for fiscal year 1996 and $1,359,000,000 for fiscal year 1997 
        1998 and $1,385,500,000 for fiscal year 1999 and later fiscal 
        years.  The general education tax rate may not be changed due to 
        changes or corrections made to a district's adjusted net tax 
        capacity after the tax rate has been established.  If the levy 
        target for fiscal year 1999 is changed by another law enacted 
        during the 1997 session, the commissioner shall reduce the 
        target in this bill by the amount of the reduction in the 
        enacted law. 
           Sec. 47.  Minnesota Statutes 1996, section 124A.23, 
        subdivision 2, is amended to read: 
           Subd. 2.  [GENERAL EDUCATION LEVY.] To obtain general 
        education revenue, excluding transition revenue and supplemental 
        revenue, a district may levy an amount not to exceed the general 
        education tax rate times the adjusted net tax capacity of the 
        district for the preceding year.  If the amount of the general 
        education levy would exceed the general education revenue, 
        excluding supplemental revenue, the general education levy shall 
        be determined according to subdivision 3.  
           Sec. 48.  Minnesota Statutes 1996, section 124A.23, 
        subdivision 3, is amended to read: 
           Subd. 3.  [GENERAL EDUCATION LEVY; DISTRICTS OFF THE 
        FORMULA.] If the amount of the general education levy for a 
        district exceeds the district's general education revenue, 
        excluding training and experience transition revenue and 
        supplemental revenue, the amount of the general education levy 
        shall be limited to the following: 
           (1) the district's general education revenue, excluding 
        training and experience transition revenue and supplemental 
        revenue; plus 
           (2) the amount of the aid reduction for the same school 
        year according to section 124A.24; minus 
           (3) payments made for the same school year according to 
        section 124A.035, subdivision 4. 
           For purposes of statutory cross-reference, a levy made 
        according to this subdivision shall be construed to be the levy 
        made according to subdivision 2. 
           Sec. 49.  Minnesota Statutes 1996, section 124A.23, 
        subdivision 5, is amended to read: 
           Subd. 5.  [USES OF REVENUE.] Except as provided in 
        section sections 124A.22, subdivision 11; 124A.225; and 124A.28, 
        general education revenue may be used during the regular school 
        year and the summer for general and special school purposes. 
           Sec. 50.  Minnesota Statutes 1996, section 124A.26, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [REVENUE REDUCTION FUND BALANCE PUPIL UNIT 
        DEFINITION.] A district's general education revenue for a school 
        year shall be reduced if the estimated net unappropriated 
        operating fund balance as of June 30 in the prior school year 
        exceeds 25 percent of the formula allowance for the current 
        fiscal year times the fund balance pupil units in the prior 
        year.  For purposes of this subdivision and section 124.243, 
        subdivision 2, Fund balance pupil units means the number of 
        resident pupil units in average daily membership, including 
        shared time pupils, according to section 124A.02, subdivision 
        20, plus 
           (1) pupils attending the district for which general 
        education aid adjustments are made according to section 
        124A.036, subdivision 5; minus 
           (2) the sum of the resident pupils attending other 
        districts for which general education aid adjustments are made 
        according to section 124A.036, subdivision 5, plus pupils for 
        whom payment is made according to section 126.22, subdivision 8, 
        or 126.23.  The amount of the reduction shall equal the lesser 
        of: 
           (1) the amount of the excess, or 
           (2) $250 times the actual pupil units for the school year. 
           The final adjustment payments made under section 124.195, 
        subdivision 6, must be adjusted to reflect actual net operating 
        fund balances as of June 30 of the prior school year. 
           Sec. 51.  Minnesota Statutes 1996, section 124A.28, is 
        amended to read: 
           124A.28 [COMPENSATORY EDUCATION REVENUE.] 
           Subdivision 1.  [USE OF THE REVENUE.] The compensatory 
        education revenue under section 124A.22, subdivision 3, must be 
        used to meet the educational needs of pupils whose educational 
        achievement progress toward meeting state or local content or 
        performance standards is below the level that is appropriate for 
        pupils learners of their age.  These needs may be met by 
        providing the Any of the following may be provided to meet these 
        learners' needs: 
           (1) direct instructional services under the assurance of 
        mastery program according to section 124.311 124.3111; 
           (2) remedial instruction in reading, language arts, and 
        mathematics, other content areas, or study skills to improve the 
        achievement level of these pupils learners; 
           (3) additional teachers and teacher aides to provide more 
        individualized instruction to these pupils learners through 
        individual tutoring, lower instructor-to-learner ratios, or team 
        teaching; 
           (4) summer programs that enable these pupils to improve 
        their achievement or that reemphasize material taught during the 
        regular school year a longer school day or week during the 
        regular school year or through a summer program that may be 
        offered directly by the site or under a performance-based 
        contract with a community-based organization; 
           (5) in-service education comprehensive and ongoing staff 
        development consistent with district and site plans according to 
        section 126.70, for teachers, teacher aides, principals, and 
        other personnel to improve their ability to recognize identify 
        the needs of these pupils learners and provide 
        appropriate responses to the pupils' needs remediation, 
        intervention, accommodations, or modifications; 
           (6) for instructional material for these pupils including:  
        textbooks, workbooks, periodicals, pamphlets, photographs, 
        reproductions, filmstrips, prepared slides, prerecorded video 
        programs, sound recordings, desk charts, games, study prints and 
        pictures, desk maps, models, learning kits, blocks and cubes, 
        flashcards, instructional computer software programs, pencils, 
        pens, crayons, notebooks, duplicating fluids, and 
        papers materials and technology appropriate for meeting the 
        individual needs of these learners; 
           (7) programs to reduce truancy, encourage completion of 
        high school, enhance self-concept, provide health services, 
        provide nutrition services, provide a safe and secure learning 
        environment, provide coordination for pupils receiving services 
        from other governmental agencies, provide psychological services 
        to determine the level of social, emotional, cognitive, and 
        intellectual development, and provide counseling services, 
        guidance services, and social work services; 
           (8) bilingual programs, bicultural programs, and programs 
        for pupils learners of limited English proficiency; 
           (9) all day kindergarten; 
           (10) extended school day and extended school year programs; 
        and 
           (11) substantial parent involvement in developing and 
        implementing remedial education or intervention plans for a 
        learner, including learning contracts between the school, the 
        learner, and the parent that establish achievement goals and 
        responsibilities of the learner and the learner's parent or 
        guardian; and 
           (12) other methods to increase achievement, as needed.  
           Subd. 1a.  [BUILDING ALLOCATION.] A district must consider 
        the concentration of children from low-income families 
        in allocate revenue to each school building in the district when 
        allocating compensatory revenue where the children who have 
        generated the revenue are served. 
           If the pupil is served at a site other than one owned and 
        operated by the district, the revenue shall be paid to the 
        district and used for services for pupils who generate the 
        revenue. 
           Subd. 1b.  [RECOMMENDATION.] A school site decision-making 
        team, as defined in section 123.951, subdivision 3, paragraph 
        (a), or the instruction and curriculum advisory committee under 
        section 123.972, if the school has no school site decision team, 
        shall recommend how the revenue will be used to carry out the 
        purpose of this section. 
           Subd. 2.  [SEPARATE ACCOUNTS.] Each district that receives 
        compensatory education revenue shall maintain separate accounts 
        to identify expenditures for salaries and programs related to 
        this basic skills revenue. 
           Subd. 3.  [ANNUAL EXPENDITURE REPORT.] Each year a district 
        that receives compensatory education revenue shall submit a 
        report identifying the expenditures it incurred in providing 
        compensatory education to the pupils described in to meet the 
        needs of eligible learners under subdivision 1.  The report must 
        conform to uniform financial and reporting standards established 
        for this purpose. 
           Sec. 52.  Laws 1991, chapter 265, article 1, section 30, as 
        amended by Laws 1993, chapter 224, article 8, section 19, is 
        amended to read: 
           Sec. 30.  [BADGER SCHOOL DISTRICT FUND BALANCE.] 
           If independent school district No. 676, Badger, receives 
        payment of delinquent property taxes from one taxpayer and the 
        payment is more than five percent of the total property taxes 
        paid in the fiscal year in which the payment is received, 
        general education revenue for the district shall not be reduced 
        according to Minnesota Statutes, section 124A.26, subdivision 1, 
        for an excess fund balance attributed to the payment for the 
        following five ten fiscal years. 
           Sec. 53.  Laws 1995, First Special Session chapter 3, 
        article 1, section 56, is amended to read: 
           Sec. 56.  [SUPPLEMENTAL REVENUE REDUCTION.] 
           For fiscal years 1996 1998 and 1997 1999, if a district's 
        ratio of 1992 adjusted net tax capacity divided by 1994-1995 
        actual pupil units to $9,025 is less than or equal to .25, then 
        the difference under Minnesota Statutes, section 124A.22, 
        subdivision 9, clause (2), is equal to $25 $0 for purposes of 
        computing the district's supplemental revenue under Minnesota 
        Statutes, section 124A.22, subdivision 8.  For purposes of 
        computing the referendum allowance reduction under Minnesota 
        Statutes, section 124A.03, subdivision 3b, the supplemental 
        revenue reduction shall be computed according to Minnesota 
        Statutes, section 124A.22, subdivision 9. 
           Sec. 54.  Laws 1995, First Special Session chapter 3, 
        article 2, section 52, is amended to read: 
           Sec. 52.  [TRANSPORTATION AIDS AND LEVIES; SUSPENSION.] 
           Minnesota Statutes 1994, sections 124.225, subdivisions 1, 
        3a, 7a, 7b, 7d, 7e, 8a, 8k, 8m, and 10; and 124.226, 
        subdivisions 1, 2, 3a, 4, 5, 6, 7, and 8, do not apply to aids 
        payable in fiscal years 1997 and 1998 or to levies made in 1995 
        and 1996 for taxes payable in 1996 and 1997. 
           Sec. 55.  [RESTORATION OF REVENUE LOST TO FUND BALANCE 
        REDUCTION; MADELIA.] 
           Subdivision 1.  [AID ADJUSTMENT.] Notwithstanding Minnesota 
        Statutes, section 124A.26, subdivision 3, general education aid 
        for independent school district No. 837, Madelia, shall not be 
        reduced for fiscal year 1997. 
           Subd. 2.  [LEVY ADJUSTMENT.] Independent school district No.
        837, Madelia, may make a positive levy adjustment for taxes 
        payable in 1998 equal to the amount of the general education 
        levy reduction required under Minnesota Statutes, section 
        124A.26, subdivision 2, attributed to fiscal year 1997. 
           Sec. 56.  [RESTORATION OF REVENUE LOST TO FUND BALANCE 
        REDUCTION; HERMAN-NORCROSS.] 
           Subdivision 1.  [AID ADJUSTMENT.] Notwithstanding Minnesota 
        Statutes, section 124A.26, subdivision 3, general education aid 
        for independent school district No. 264, Herman-Norcross, shall 
        not be reduced for fiscal year 1997. 
           Subd. 2.  [LEVY ADJUSTMENT.] Independent school district No.
        264, Herman-Norcross, may make a positive levy adjustment for 
        taxes payable in 1998 equal to the amount of the general 
        education levy reduction required under Minnesota Statutes, 
        section 124A.26, subdivision 2, attributed to fiscal year 1997. 
           Sec. 57.  [LEVY ADJUSTMENT ATTRIBUTABLE TO THE REPEAL OF 
        THE K-12 APPROPRIATIONS CAPS.] 
           Notwithstanding Minnesota Statutes, section 124.918, 
        subdivision 6, a school district may spread any positive 
        referendum levy adjustments for fiscal year 1998 resulting from 
        the enactment of Laws 1997, chapter 1, over a three-year period 
        beginning with taxes payable in 1998. 
           Sec. 58.  [BUS PURCHASE LEVY.] 
           For 1997 taxes payable in 1998, a school district may levy 
        the amount necessary to eliminate the deficit in the reserved 
        fund balance account for bus purchases in its transportation 
        fund as of June 30, 1996. 
           Sec. 59.  [LEP CONCENTRATION AID; FISCAL YEAR 1998.] 
           For fiscal year 1998 only, a school district's LEP revenue 
        under Minnesota Statutes, section 124.273, subdivision 1g, is 
        increased by $190 times the district's LEP pupil units 
        determined according to article 2, section 3. 
           Sec. 60.  [COMPENSATORY REVENUE GROWTH LIMIT.] 
           For fiscal years 1998 and 1999, the commissioner shall 
        limit the growth in compensatory revenue a district receives 
        according to this article.  The commissioner shall compare the 
        compensatory revenue a district receives under the changes in 
        section 12 with the compensatory revenue per pupil unit a 
        district would have received if section 12 had not been 
        enacted.  A district may not receive an increase in compensatory 
        revenue in excess of $300 per pupil unit. 
           Sec. 61.  [SCHOOL DISTRICT LEVY ADJUSTMENTS.] 
           Subdivision 1.  [REVENUE CONVERSION.] The commissioner of 
        children, families, and learning shall adjust each school 
        district's revenue authority that is established as a rate times 
        net tax capacity or adjusted net tax capacity under Minnesota 
        Statutes, chapters 124 and 124A, by multiplying each revenue 
        amount by the ratio of the statewide tax capacity as calculated 
        using the class rates in effect for assessment year 1996 to the 
        statewide tax capacity using the class rates for that assessment 
        year. 
           Subd. 2.  [TAX RATE ADJUSTMENT.] The commissioner shall 
        adjust each tax rate established under Minnesota Statutes, 
        chapters 124 and 124A, by multiplying the rate by the ratio of 
        the statewide tax capacity as calculated using the class rates 
        in effect for assessment year 1996 to the statewide tax capacity 
        using the class rates for that assessment year. 
           Subd. 3.  [EQUALIZING FACTORS.] The commissioner shall 
        adjust each equalizing factor established under Minnesota 
        Statutes, chapters 124 and 124A, by dividing the equalizing 
        factor by the ratio of the statewide tax capacity as calculated 
        using the class rates in effect for assessment year 1996 to the 
        statewide tax capacity using the class rates for that assessment 
        year. 
           Subd. 4.  [QUALIFYING RATE.] The commissioner shall adjust 
        the qualifying rate under section 124.95, subdivision 3, by 
        multiplying the qualifying rate times the ratio of the statewide 
        tax capacity, as calculated using the class rates in effect for 
        assessment year 1996, to the statewide tax capacity using the 
        class rates for that assessment year. 
           Sec. 62.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated.  
           Subd. 2.  [GENERAL AND SUPPLEMENTAL EDUCATION AID.] For 
        general and supplemental education aid:  
         $2,584,703,000     .....     1998
         $2,698,990,000     .....     1999
           The 1998 appropriation includes $227,499,000 for 1997 and 
        $2,357,204,000 for 1998.  
           The 1999 appropriation includes $247,099,000 for 1998 and 
        $2,451,891,000 for 1999.  
           Of the 1998 appropriation, the first $113,800,000 is from 
        the education aids reserve of the general fund. 
           Subd. 3.  [TRANSPORTATION SAFETY.] For student 
        transportation safety aid according to Minnesota Statutes, 
        section 124.225, subdivision 8m: 
             $1,430,000     .....     1998 
             $1,458,000     .....     1999
           The 1998 appropriation includes $129,000 for 1997 and 
        $1,301,000 for 1998.  
           The 1999 appropriation includes $144,000 for 1998 and 
        $1,314,000 for 1999. 
           Subd. 4.  [TRANSPORTATION AID FOR ENROLLMENT OPTIONS.] For 
        transportation of pupils attending post-secondary institutions 
        according to Minnesota Statutes, section 123.3514, or for 
        transportation of pupils attending nonresident districts 
        according to Minnesota Statutes, section 120.062: 
             $102,000       .....     1998
             $102,000       .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 5.  [WIDE AREA TRANSPORTATION SERVICE PILOT PROJECT.] 
        To expand the wide area transportation service project: 
             $170,000      .....      1998 
             $ 50,000      .....      1999 
           Of the amount in fiscal year 1998, $70,000 is for a grant 
        to the Minnesota river valley special education cooperative for 
        a computerized routing system. 
           The purpose is to expand the project for the computerized 
        mapping and scheduling programs for school districts to jointly 
        provide transportation services for low-incidence programs.  The 
        department shall work with representatives of the affected 
        programs, transportation managers from both metropolitan and 
        rural districts, and the metropolitan council.  The department 
        shall contract for services and provide oversight.  The 
        department must report to the education committees of the 
        legislature by February 15, 1998, on the operation of the wide 
        area transportation service project, including details regarding 
        whether the project is meeting its objectives and any problems 
        related to the service provided by the project.  The project 
        shall consider the relationship of education transportation with 
        transportation services provided by noneducation agencies.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 6.  [INTERDISTRICT DESEGREGATION OR INTEGRATION 
        TRANSPORTATION GRANTS.] For interdistrict desegregation or 
        integration transportation grants under Minnesota Statutes, 
        section 124.227: 
             $800,000       .....     1998
             $970,000       .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 7.  [TARGETED NEEDS TRANSPORTATION AID.] For aid 
        payments for targeted needs transportation aid under Minnesota 
        Statutes, section 124.225, subdivisions 13 and 16: 
             $76,195,000    .....     1998
             $24,303,000    .....     1999
           The 1998 appropriation includes $7,148,000 for 1997 and 
        $69,047,000 for 1998. 
           The 1999 appropriation includes $7,671,000 for 1998 and 
        $16,632,000 for 1999. 
           Subd. 8.  [HEALTH AND SAFETY AID.] For health and safety 
        aid according to Minnesota Statutes, section 124.83, subdivision 
        5: 
             $14,081,000    .....     1998 
             $14,179,000    .....     1999 
           The 1998 appropriation includes $1,132,000 for 1997 and 
        $12,949,000 for 1998.  
           The 1999 appropriation includes $1,438,000 for 1998 and 
        $12,741,000 for 1999.  
           Subd. 9.  [DEBT SERVICE AID.] For debt service aid 
        according to Minnesota Statutes, section 124.95, subdivision 5: 
             $35,480,000     .....     1998
             $38,159,000     .....     1999
           The 1998 appropriation includes $3,313,000 for 1997 and 
        $32,167,000 for 1998. 
           The 1999 appropriation includes $3,574,000 for 1998 and 
        $34,585,000 for 1999. 
           Subd. 10.  [SHIFT SIMPLIFIED.] For additional general 
        education aid for simplifying the property tax recognition shift 
        under this article: 
            $18,700,000     .....     1998
           Sec. 63.  [REPEALER.] 
           (a) Minnesota Statutes 1996, sections 121.904, subdivision 
        4d; 121.912, subdivision 7; and 124A.26, subdivisions 1a, 2, 3, 
        4, and 5, are repealed. 
           (b) Minnesota Statutes 1996, sections 124.223; 124.225, 
        subdivisions 3a, 7a, 7b, 7d, 7e, 8a, 8k, and 10; and 124A.22, 
        subdivisions 4a and 4b, are repealed effective July 1, 1997. 
           (c) Minnesota Statutes 1996, sections 124.226; and 124.912, 
        subdivisions 2 and 3, are repealed effective for revenue for 
        fiscal year 1999. 
           Sec. 64.  [EFFECTIVE DATE.] 
           (a) Sections 2, 11, 29, 30, 32, and 43 are effective for 
        revenue for fiscal year 1997.  
           (b) Sections 42 and 45 are effective for fiscal year 1999. 
           (c) If this act is enacted on or after July 1, 1997, all 
        sections in this article except for those sections listed in 
        paragraphs (a) and (b) are effective the day following final 
        enactment. 
                                   ARTICLE 2 
                                SPECIAL PROGRAMS 
           Section 1.  Minnesota Statutes 1996, section 120.1701, 
        subdivision 3, is amended to read: 
           Subd. 3.  [STATE INTERAGENCY COORDINATING COUNCIL.] An 
        interagency coordinating council of at least 17, but not more 
        than 25 members is established, in compliance with Public Law 
        Number 102-119, section 682.  The members shall be appointed by 
        the governor.  Council members shall elect the council chair.  
        The representative of the commissioner of children, families, 
        and learning may not serve as the chair.  The council shall be 
        composed of at least five parents, including persons of color, 
        of children with disabilities under age 12, including at least 
        three parents of a child with a disability under age seven, five 
        representatives of public or private providers of services for 
        children with disabilities under age five, including a special 
        education director, county social service director, and a 
        community health services or public health nursing 
        administrator, one member of the senate, one member of the house 
        of representatives, one representative of teacher preparation 
        programs in early childhood-special education or other 
        preparation programs in early childhood intervention, at least 
        one representative of advocacy organizations for children with 
        disabilities under age five, one physician who cares for young 
        children with special health care needs, one representative each 
        from the commissioners of commerce, children, families, and 
        learning, health, human services, and economic security, and a 
        representative from Indian health services or a tribal council.  
        Section 15.059, subdivisions 2 to 5, apply to the council.  The 
        council shall meet at least quarterly.  
           The council shall address methods of implementing the state 
        policy of developing and implementing comprehensive, 
        coordinated, multidisciplinary interagency programs of early 
        intervention services for children with disabilities and their 
        families. 
           The duties of the council include recommending policies to 
        ensure a comprehensive and coordinated system of all state and 
        local agency services for children under age five with 
        disabilities and their families.  The policies must address how 
        to incorporate each agency's services into a unified state and 
        local system of multidisciplinary assessment practices, 
        individual intervention plans, comprehensive systems to find 
        children in need of services, methods to improve public 
        awareness, and assistance in determining the role of interagency 
        early intervention committees.  
           Each year by June 1, the council shall recommend to the 
        governor and the commissioners of children, families, and 
        learning, health, human services, commerce, and economic 
        security policies for a comprehensive and coordinated system. 
           Notwithstanding any other law to the contrary, the state 
        interagency coordinating council shall expire on June 30, 1997 
        2001. 
           Sec. 2.  Minnesota Statutes 1996, section 120.181, is 
        amended to read: 
           120.181 [PLACEMENT OF CHILDREN WITHOUT DISABILITIES; 
        EDUCATION AND TRANSPORTATION.] 
           The responsibility for providing instruction and 
        transportation for a pupil without a disability who has a 
        short-term or temporary physical or emotional illness or 
        disability, as determined by the standards of the state board, 
        and who is temporarily placed for care and treatment for that 
        illness or disability, shall be determined as provided in this 
        section.  
           (a) The school district of residence of the pupil shall be 
        the district in which the pupil's parent or guardian resides, or 
        when neither the pupil's parent or guardian resides within the 
        state and tuition has been denied, the district designated by 
        the commissioner of children, families, and learning if neither 
        parent nor guardian is living within the state.  
           (b) Prior to the placement of a pupil for care and 
        treatment, the district of residence shall be notified and 
        provided an opportunity to participate in the placement 
        decision.  When an immediate emergency placement is necessary 
        and time does not permit resident district participation in the 
        placement decision, the district in which the pupil is 
        temporarily placed, if different from the district of residence, 
        shall notify the district of residence of the emergency 
        placement within 15 days of the placement.  
           (c) When a pupil without a disability is temporarily placed 
        for care and treatment in a day program and the pupil continues 
        to live within the district of residence during the care and 
        treatment, the district of residence shall provide instruction 
        and necessary transportation for the pupil.  The district may 
        provide the instruction at a school within the district of 
        residence, at the pupil's residence, or in the case of a 
        placement outside of the resident district, in the district in 
        which the day treatment program is located by paying tuition to 
        that district.  The district of placement may contract with a 
        facility to provide instruction by teachers licensed by the 
        state board of teaching.  
           (d) When a pupil without a disability is temporarily placed 
        in a residential program for care and treatment, the district in 
        which the pupil is placed shall provide instruction for the 
        pupil and necessary transportation while the pupil is receiving 
        instruction, and in the case of a placement outside of the 
        district of residence, the nonresident district shall bill the 
        district of residence for the actual cost of providing the 
        instruction for the regular school year and for summer school, 
        excluding transportation costs.  When a pupil without a 
        disability is temporarily placed in a residential program 
        outside the district of residence, the administrator of the 
        court placing the pupil shall send timely written notice of the 
        placement to the district of residence.  The district of 
        placement may contract with a residential facility to provide 
        instruction by teachers licensed by the state board of teaching. 
           (e) The district of residence shall include the pupil in 
        its residence count of pupil units and pay tuition as provided 
        in section 124.18 to the district providing the instruction.  
        Transportation costs shall be paid by the district providing the 
        transportation and the state shall pay transportation aid to 
        that district.  For purposes of computing state transportation 
        aid, pupils governed by this subdivision shall be included in 
        the disabled transportation category.  
           Sec. 3.  Minnesota Statutes 1996, section 124.17, is 
        amended by adding a subdivision to read: 
           Subd. 7.  [LEP PUPIL UNITS.] (a) Limited English 
        proficiency pupil units for fiscal year 1998 and thereafter 
        shall be determined according to this subdivision. 
           (b) The limited English proficiency concentration 
        percentage for a district equals the product of 100 times the 
        ratio of: 
           (1) the number of pupils of limited English proficiency 
        enrolled in the district during the current fiscal year; to 
           (2) the number of pupils in average daily membership 
        enrolled in the district. 
           (c) The limited English proficiency pupil units for each 
        pupil enrolled in a program for pupils of limited English 
        proficiency in accordance with sections 126.261 to 126.269 
        equals the lesser of one or the quotient obtained by dividing 
        the limited English proficiency concentration percentage for the 
        pupil's district of enrollment by 11.5. 
           (d) Limited English proficiency pupil units shall be 
        counted by the district of enrollment. 
           Sec. 4.  Minnesota Statutes 1996, section 124.248, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SPECIAL EDUCATION AND LIMITED ENGLISH 
        PROFICIENCY AID.] Except as provided in subdivision 1a, 
        paragraph (b), special education aid shall be paid to a charter 
        school according to sections 124.3201 and 124.3202, as though it 
        were a school district.  The charter school may charge tuition 
        to the district of residence as provided in section 120.17, 
        subdivision 4.  Limited English proficiency programs aid shall 
        be paid to a charter school according to section 124.273 as 
        though it were a school district.  The charter school shall 
        allocate its special education levy equalization revenue to the 
        resident districts of the pupils attending the charter school.  
        The districts of residence shall levy as though they were 
        participating in a cooperative, as provided in section 124.321, 
        subdivision 3. 
           Sec. 5.  Minnesota Statutes 1996, section 124.2613, 
        subdivision 3, is amended to read: 
           Subd. 3.  [QUALIFYING SCHOOL SITE.] (a) The commissioner 
        shall rank all school sites with kindergarten programs that do 
        not exclusively serve students under section 120.17.  The 
        ranking must be from highest to lowest based on the site's free 
        and reduced lunch count as a percent of the fall enrollment 
        using the preceding October 1 enrollment data.  Once a school 
        site is calculated to be eligible, it remains eligible for the 
        duration of the pilot program.  For each school site, the 
        percentage used to calculate the ranking must be the greater of 
        (1) the percent of the fall kindergarten enrollment receiving 
        free and reduced lunch, or (2) the percent of the total fall 
        enrollment receiving free and reduced lunch.  The list of ranked 
        sites must be separated into the following geographic areas:  
        Minneapolis district, St. Paul district, suburban Twin Cities 
        districts in the seven-county metropolitan area, and school 
        districts in greater Minnesota. 
           (b) The commissioner shall establish a process and 
        timelines to qualify school sites for the next school year.  
        School sites must be qualified in each geographic area from the 
        list of ranked sites until the estimated revenue available for 
        this program has been allocated.  The total estimated revenue of 
        $3,500,000 must be distributed to qualified school sites in each 
        geographic area as follows:  25 percent for Minneapolis sites, 
        25 percent for St. Paul sites, 25 percent for suburban Twin 
        Cities sites, and 25 percent for greater Minnesota. 
           Sec. 6.  Minnesota Statutes 1996, section 124.2613, 
        subdivision 4, is amended to read: 
           Subd. 4.  [PROGRAM.] A qualifying school site must develop 
        its first-grade preparedness program in collaboration with other 
        providers of school readiness and child development services.  A 
        school site must either offer a full-day kindergarten program to 
        participating children who are five years of age or older for 
        the full school day every day or a half-day, a program for 
        participating children who are four years old, or a combination 
        of both.  The program may offer as an option to families home 
        visits and other practices as appropriate, and may provide such 
        services with the consent of the parent or guardian.  Full-day 
        and half-day kindergarten Program providers must ensure that the 
        program they provide supplements existing school readiness and 
        child development programs and complements the services provided 
        with compensatory revenue.  Where possible, individuals 
        receiving assistance under a family assistance plan can meet the 
        work activity requirement of the plan by participating in a 
        first-grade preparedness program as a volunteer. 
           Sec. 7.  Minnesota Statutes 1996, section 124.2613, 
        subdivision 6, is amended to read: 
           Subd. 6.  [PREPAREDNESS REVENUE.] (a) A qualifying school 
        district is eligible for first-grade preparedness revenue equal 
        to the basic formula allowance for that year times the number of 
        pupil units calculated according to paragraph (b) in each 
        qualifying school site.  If the first-grade preparedness revenue 
        is insufficient to fully fund the formula amounts, the 
        commissioner shall prorate the revenue provided to each 
        qualifying school site of children five years of age or older 
        enrolled in a kindergarten program at the site on October 1 of 
        the previous year times .53. 
           (b) A pupil enrolled in a half-day first-grade preparedness 
        program under this section is counted as .53 pupil units.  A 
        pupil enrolled in a full-day first-grade preparedness program 
        under this section is counted as a kindergarten pupil under 
        section 124.17, subdivision 1, plus an additional .53 pupil 
        units. 
           (c) This revenue must supplement and not replace 
        compensatory revenue that the district uses for the same or 
        similar purposes under chapter 124A. 
           (c) A pupil enrolled in the first grade preparedness 
        program at a qualifying school site is eligible for 
        transportation under section 123.39, subdivision 1.  
           (d) First grade preparedness revenue paid to a charter 
        school for which a school district is providing transportation 
        according to section 120.064, subdivision 15, shall be decreased 
        by an amount equal to the product of $170 times the pupil units 
        calculated according to paragraph (a).  This amount shall be 
        paid to the school district for transportation costs.  
           Sec. 8.  Minnesota Statutes 1996, section 124.273, 
        subdivision 1d, is amended to read: 
           Subd. 1d.  [LEP BASE REVENUE.] (a) The limited English 
        proficiency programs base revenue equals the sum of the 
        following amounts, computed using base year data:  
           (1) 68 percent of the salary of one full-time equivalent 
        teacher for each 40 pupils of limited English proficiency 
        enrolled, or 68 percent of the salary of one-half of a full-time 
        teacher in a district with 20 or fewer pupils of limited English 
        proficiency enrolled; and 
           (2) for supplies and equipment purchased or rented for use 
        in the instruction of pupils of limited English proficiency an 
        amount equal to 47 percent of the sum actually spent by the 
        district but not to exceed an average of $47 in any one school 
        year for each pupil of limited English proficiency receiving 
        instruction. 
           (b) For the purposes of this subdivision, a teacher 
        includes nonlicensed personnel who provide direct instruction to 
        students of limited English proficiency under the supervision of 
        a licensed teacher. 
           (c) If requested by a school district operating a limited 
        English proficiency program during the base year for less than 
        the full school year, the commissioner may adjust the base 
        revenue to reflect the expenditures that would have occurred 
        during the base year had the program been operated for the full 
        school year. 
           Sec. 9.  Minnesota Statutes 1996, section 124.273, 
        subdivision 1e, is amended to read: 
           Subd. 1e.  [AID.] A district's limited English proficiency 
        aid for fiscal year 1996 and later 1998 equals the aid 
        percentage factor under section 124.3201, subdivision 1, times 
        the district's limited English proficiency revenue. 
           Sec. 10.  Minnesota Statutes 1996, section 124.273, 
        subdivision 1f, is amended to read: 
           Subd. 1f.  [STATE TOTAL LEP REVENUE.] (a) The state total 
        limited English proficiency programs revenue for fiscal 
        year 1996 1998 equals $12,202,000 $14,629,000.  The state total 
        limited English proficiency programs revenue for fiscal 
        year 1997 1999 equals $13,299,000 $16,092,000.  
           (b) The state total limited English proficiency programs 
        revenue for later fiscal years equals: 
           (1) the state total limited English proficiency programs 
        revenue for the preceding fiscal year; times 
           (2) the program growth factor under section 124.3201, 
        subdivision 1; times 
           (3) the ratio of the state total number of pupils with 
        limited English proficiency for the current fiscal year to the 
        state total number of pupils with limited English proficiency 
        for the preceding fiscal year. 
           Sec. 11.  Minnesota Statutes 1996, section 124.273, 
        subdivision 5, is amended to read: 
           Subd. 5.  [NOTIFICATION; AID PAYMENTS REVENUE.] The 
        department must promptly inform each applicant district of the 
        amount of aid revenue it will receive pursuant to this section. 
           Sec. 12.  [124.3111] [ASSURANCE OF MASTERY PROGRAMS.] 
           Subdivision 1.  [ELIGIBLE DISTRICTS.] A district with a 
        local process to review curriculum and instruction may provide 
        an assurance of mastery program to eligible pupils. 
           Subd. 2.  [ELIGIBLE PUPILS.] A pupil is eligible to receive 
        services through an assurance of mastery program if the pupil 
        has not demonstrated progress toward mastering the required 
        graduation standards, after receiving instruction that was 
        designed to enable the pupil to make progress toward mastering 
        the required graduation standards in a regular classroom 
        setting.  To determine pupil eligibility, a district must use a 
        process adopted by the school board to review curriculum and 
        instruction, for the subjects and at the grade level at which 
        the district uses the revenue. 
           Subd. 3.  [ELIGIBLE SERVICES.] (a) Assurance of mastery 
        programs may provide direct instructional services to an 
        eligible pupil, or a group of eligible pupils, under the 
        following conditions in paragraphs (b) to (d). 
           (b) Instruction may be provided at one or more grade levels 
        from kindergarten to grade 8 and for students in grades 9 
        through 12 who have failed the basic skills tests.  If an 
        assessment of pupils' needs within a district demonstrates that 
        the eligible pupils in grades kindergarten to grade 8 are being 
        appropriately served, a district may serve eligible pupils in 
        grades 9 to 12. 
           (c) Instruction must be provided under the supervision of 
        the eligible pupil's regular classroom teacher.  Instruction may 
        be provided by the eligible pupil's classroom teacher, by 
        another teacher, by a team of teachers, or by an education 
        assistant or aide.  A special education teacher may provide 
        instruction, but instruction that is provided under this section 
        is not eligible for aid under section 124.3201. 
           (d) The instruction that is provided must differ from the 
        initial instruction the pupil received in the regular classroom 
        setting.  The instruction may differ by presenting different 
        curriculum than was initially presented in the regular classroom 
        or by presenting the same curriculum: 
           (1) at a different rate or in a different sequence than it 
        was initially presented; 
           (2) using different teaching methods or techniques than 
        were used initially; or 
           (3) using different instructional materials than were used 
        initially. 
           Sec. 13.  Minnesota Statutes 1996, section 124.312, 
        subdivision 4, is amended to read: 
           Subd. 4.  [INTEGRATION REVENUE.] For fiscal year years 
        1996, 1997, and later fiscal years 1998, integration revenue 
        equals the sum of integration aid and integration levy under 
        section 124.912, subdivision 2. 
           Sec. 14.  Minnesota Statutes 1996, section 124.312, 
        subdivision 5, is amended to read: 
           Subd. 5.  [INTEGRATION AID.] For fiscal year years 1996, 
        1997, and later fiscal years 1998, integration aid equals the 
        following amounts: 
           (1) for independent school district No. 709, Duluth, 
        $1,385,000; 
           (2) for independent school district No. 625, St. Paul, 
        $8,090,700; and 
           (3) for special school district No. 1, Minneapolis, 
        $9,368,300. 
           Sec. 15.  Minnesota Statutes 1996, section 124.313, is 
        amended to read: 
           124.313 [TARGETED NEEDS REVENUE.] 
           For fiscal year years 1996, 1997, and thereafter 1998, a 
        school district's targeted needs revenue equals the sum of: 
           (1) assurance of mastery revenue according to section 
        124.311; plus 
           (2) the district's limited English proficiency revenue 
        computed according to section 124.273, subdivision 1d; plus 
           (3) integration revenue computed according to section 
        124.312, subdivision 4. 
           Sec. 16.  Minnesota Statutes 1996, section 124.314, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AID.] For fiscal year years 1996, 1997, 
        and thereafter 1998, a school district's targeted needs aid 
        equals the sum of its assurance of mastery aid according to 
        section 124.311, its limited English proficiency aid according 
        to section 124.273, subdivision 1e, and its integration aid 
        according to section 124.312, subdivision 5. 
           Sec. 17.  Minnesota Statutes 1996, section 124.314, 
        subdivision 2, is amended to read: 
           Subd. 2.  [LEVY.] For fiscal year years 1996, 1997, and 
        thereafter 1998, a school district's targeted needs levy equals 
        the sum of its integration levy under section 124.912, 
        subdivision 2, and that portion of its special education levy 
        attributed to the limited English proficiency program. 
           Sec. 18.  [124.315] [INTEGRATION REVENUE.] 
           Subdivision 1.  [USE OF THE REVENUE.] Integration revenue 
        under this section must be used for programs established under a 
        desegregation plan mandated by the state board or under court 
        order, to increase learning opportunities and reduce the 
        learning gap between learners living in high concentrations of 
        poverty and their peers. 
           Subd. 2.  [SEPARATE ACCOUNT.] Integration revenue shall be 
        maintained in a separate account to identify expenditures for 
        salaries and programs related to this revenue. 
           Subd. 3.  [INTEGRATION REVENUE.] For fiscal year 1999 and 
        later fiscal years, integration revenue equals the following 
        amounts: 
           (1) for independent school district No. 709, Duluth, $193 
        times the actual pupil units for the school year; 
           (2) for independent school district No. 625, St. Paul, $427 
        times the actual pupil units for the school year; 
           (3) for special school district No. 1, Minneapolis, $523 
        times the actual pupil units for the school year; and 
           (4) for a district not listed in clause (1), (2), or (3) 
        that is required to implement a plan according to the 
        requirements of Minnesota Rules, parts 3535.0200 to 3535.2200, 
        the lesser of the actual cost of implementing the plan during 
        the fiscal year or $93 times the actual pupil units for the 
        school year. 
           Subd. 4.  [INTEGRATION LEVY.] A district may levy an amount 
        equal to 46 percent of the district's integration revenue as 
        defined in subdivision 3. 
           Subd. 5.  [INTEGRATION AID.] A district's integration aid 
        equals 54 percent of the district's integration revenue as 
        defined in subdivision 3. 
           Subd. 6.  [ALTERNATIVE ATTENDANCE PROGRAMS.] (a) The 
        integration aid under subdivision 5 must be adjusted for each 
        pupil attending a nonresident district under sections 120.062, 
        120.075, 120.0751, 120.0752, and 124C.45 to 124C.48 if the 
        enrollment of the pupil in the nonresident district contributes 
        to desegregation or integration purposes.  The adjustments must 
        be made according to this subdivision.  
           (b) Aid paid to the district of the pupil's residence must 
        be reduced by an amount equal to the revenue per actual pupil 
        unit of the resident district times the number of actual pupil 
        units attributable to the pupil for the time the pupil is 
        enrolled in a nonresident district. 
           (c) Aid paid to a district serving nonresidents must be 
        increased by an amount equal to the aid reduction to the 
        resident district under paragraphs (b) and (d).  
           (d) If the amount of the reduction to be made from the aid 
        of a district is greater than the amount of aid otherwise due 
        the district, the excess reduction must be made from other state 
        aids due the district. 
           Sec. 19.  Minnesota Statutes 1996, section 124.3201, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DEFINITIONS.] For the purposes of this 
        section and sections 124.3202 and 124.321, the definitions in 
        this subdivision apply. 
           (a) "Base year" for fiscal year 1996 and fiscal year 1997 
        means the 1994 summer program and the 1994-1995 school year.  
        Base year for 1998 and later fiscal years means the second 
        fiscal year preceding the fiscal year for which aid will be paid.
           (b) "Basic revenue" has the meaning given it in section 
        124A.22, subdivision 2.  For the purposes of computing basic 
        revenue pursuant to this section, each child with a disability 
        shall be counted as prescribed in section 124.17, subdivision 1. 
           (c) "Essential personnel" means teachers, related services, 
        and support services staff providing direct services to students.
           (d) "Average daily membership" has the meaning given it in 
        section 124.17. 
           (e) "Program growth factor" means 1.00 for fiscal year 1998 
        2000 and later. 
           (f) "Aid percentage factor" means 60 percent for fiscal 
        year 1996, 70 percent for fiscal year 1997, 80 percent for 
        fiscal year 1998, 90 percent for fiscal year 1999, and 100 
        percent for fiscal years 2000 and later. 
           (g) "Levy percentage factor" means 100 minus the aid 
        percentage factor for that year. 
           Sec. 20.  Minnesota Statutes 1996, section 124.3201, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SPECIAL EDUCATION BASE REVENUE.] (a) The special 
        education base revenue equals the sum of the following amounts 
        computed using base year data: 
           (1) 68 percent of the salary of each essential person 
        employed in the district's program for children with a 
        disability during the regular school year, whether the person is 
        employed by one or more districts; 
           (2) for the Minnesota state academy for the deaf or the 
        Minnesota state academy for the blind, 68 percent of the salary 
        of each instructional aide assigned to a child attending the 
        academy, if that aide is required by the child's individual 
        education plan; 
           (3) for special instruction and services provided to any 
        pupil by contracting with public, private, or voluntary agencies 
        other than school districts, in place of special instruction and 
        services provided by the district, 52 percent of the difference 
        between the amount of the contract and the basic revenue of the 
        district for that pupil for the fraction of the school day the 
        pupil receives services under the contract; 
           (4) for special instruction and services provided to any 
        pupil by contracting for services with public, private, or 
        voluntary agencies other than school districts, that are 
        supplementary to a full educational program provided by the 
        school district, 52 percent of the amount of the contract for 
        that pupil; 
           (5) for supplies and equipment purchased or rented for use 
        in the instruction of children with a disability an amount equal 
        to 47 percent of the sum actually expended by the district but 
        not to exceed an average of $47 in any one school year for each 
        child with a disability receiving instruction; and 
           (6) for fiscal years 1997 and later, special education base 
        revenue shall include amounts under clauses (1) to (5) for 
        special education summer programs provided during the base year 
        for that fiscal year; and 
           (7) for fiscal years 1999 and later, the cost of providing 
        transportation services for children with disabilities under 
        section 124.225, subdivision 1, paragraph (b), clause (4).  
           (b) If requested by a school district operating a special 
        education program during the base year for less than the full 
        school year, the commissioner may adjust the base revenue to 
        reflect the expenditures that would have occurred during the 
        base year had the program been operated for the full school year.
           Sec. 21.  Minnesota Statutes 1996, section 124.3201, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ADJUSTED SPECIAL EDUCATION BASE REVENUE.] For 
        fiscal year 1996 1997 and later, a district's adjusted special 
        education base revenue equals the district's special education 
        base revenue times the ratio of the district's average daily 
        membership for the current school year to the district's average 
        daily membership for the base year; plus the district's special 
        education tuition revenue under subdivision 2a and special 
        education court placement revenue under subdivision 2b. 
           Sec. 22.  Minnesota Statutes 1996, section 124.3201, 
        subdivision 4, is amended to read: 
           Subd. 4.  [STATE TOTAL SPECIAL EDUCATION REVENUE.] The 
        state total special education revenue for fiscal year 1996 1998 
        equals $327,846,000 $358,542,000.  The state total special 
        education revenue for fiscal year 1997 1999 equals 
        $347,810,000 $435,322,000.  The state total special education 
        revenue for later fiscal years equals:  
           (1) the state total special education revenue for the 
        preceding fiscal year; times 
           (2) the program growth factor; times 
           (3) the ratio of the state total average daily membership 
        for the current fiscal year to the state total average daily 
        membership for the preceding fiscal year. 
           Sec. 23.  Minnesota Statutes 1996, section 124.321, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [LEVY EQUALIZATION REVENUE.] (a) For fiscal 
        years 1996 and later year 1999, special education levy 
        equalization revenue for a school district, excluding an 
        intermediate school district, equals the sum of the following 
        amounts: 
           (1) the levy percentage factor for that year times the 
        district's special education revenue under section 124.3201; 
        plus 
           (2) the levy percentage factor for that year times the 
        district's special education summer program revenue under 
        section 124.3202; plus 
           (3) the levy percentage factor for that year times the 
        district's special education excess cost revenue under section 
        124.323; plus 
           (4) the levy percentage factor for that year times the 
        district's secondary vocational education for children with a 
        disability revenue under section 124.574; plus 
           (5) the levy percentage factor for that year times the 
        district's limited English proficiency programs revenue under 
        section 124.273. 
           Sec. 24.  Minnesota Statutes 1996, section 124.323, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DEFINITIONS.] In this section, the 
        definitions in this subdivision apply. 
           (a) "Unreimbursed special education cost" means the sum of 
        the following: 
           (1) expenditures for teachers' salaries, contracted 
        services, supplies, and equipment, and transportation services 
        eligible for revenue under sections 124.3201 and 124.3202; plus 
           (2) expenditures for tuition bills received under section 
        120.17 for services eligible for revenue under sections 
        124.3201, subdivision 2, and 124.3202, subdivision 1; minus 
           (3) revenue for teachers' salaries, contracted services, 
        supplies, and equipment under sections 124.3201 and 124.3202; 
        minus 
           (4) tuition receipts under section 120.17 for services 
        eligible for revenue under sections 124.3201, subdivision 2, and 
        124.3202, subdivision 1. 
           (b) "General revenue," for fiscal year 1996, means the sum 
        of the general education revenue according to section 124A.22, 
        subdivision 1, as adjusted according to section 124A.036, 
        subdivision 5, plus the total referendum revenue according to 
        section 124A.03, subdivision 1e.  For fiscal years 1997 and 
        later, "general revenue" means the sum of the general education 
        revenue according to section 124A.22, subdivision 1, as adjusted 
        according to section 124A.036, subdivision 5, plus the total 
        referendum revenue minus transportation sparsity revenue minus 
        total operating capital revenue. 
           Sec. 25.  Minnesota Statutes 1996, section 124.323, 
        subdivision 2, is amended to read: 
           Subd. 2.  [EXCESS COST REVENUE.] For 1996 1997 and later 
        fiscal years, a district's special education excess cost revenue 
        equals 70 the greatest of: 
           (a) 70 percent of the difference between (1) the district's 
        unreimbursed special education cost and (2) six percent for 
        fiscal year 1996 and 5.7 percent for fiscal year 1997 and later 
        years of the district's general revenue; 
           (b) 70 percent of the difference between (1) the increase 
        in the district's unreimbursed special education cost between 
        the base year as defined in section 124.3201, subdivision 1, and 
        the current year and (2) 1.6 percent of the district's general 
        revenue; or 
           (c) zero. 
           Sec. 26.  Minnesota Statutes 1996, section 124.481, is 
        amended to read: 
           124.481 [INDIAN POST-SECONDARY PREPARATION GRANTS.] 
           The state board of education, with the advice of the 
        Minnesota Indian scholarship committee, may make grants to 
        school districts or tribal grant or contract schools to support 
        post-secondary preparation for secondary pupils who are of 
        one-fourth or more Indian ancestry and who, in the opinion of 
        the superintendent, have the capabilities to benefit from higher 
        education.  Distribution of the grants must be in accordance 
        with a plan prepared by the state board, with the advice of the 
        Minnesota Indian scholarship committee, that describes the 
        objectives and methods of implementing the grant program, 
        including the manner in which grants will be distributed in 
        proportion to the geographical distribution of the Indian 
        population of the state. 
           Sec. 27.  Minnesota Statutes 1996, section 124.574, 
        subdivision 2d, is amended to read: 
           Subd. 2d.  [BASE REVENUE.] (a) The secondary vocational 
        school-to-work program-disabled program base revenue equals the 
        sum of the following amounts computed using base year data: 
           (1) 68 percent of the salary of each essential licensed 
        person who provides direct instructional services to students 
        employed during that fiscal year for services rendered in that 
        district's secondary vocational education programs 
        school-to-work program for children with a disability; 
           (2) 47 percent of the costs of necessary equipment for 
        secondary vocational education programs school-to-work programs 
        for children with a disability; 
           (3) 47 percent of the costs of necessary travel between 
        instructional sites by secondary vocational education 
        school-to-work program teachers of children with a disability 
        but not including travel to and from local, regional, district, 
        state, or national vocational student organization meetings; 
           (4) 47 percent of the costs of necessary supplies for 
        secondary vocational education programs school-to-work programs 
        for children with a disability but not to exceed an average of 
        $47 in any one school year for each child with a disability 
        receiving these services; 
           (5) for secondary vocational education programs 
        school-to-work programs for children with disabilities provided 
        by a contract approved by the commissioner with public, private, 
        or voluntary agencies other than a Minnesota school district or 
        cooperative center, in place of programs provided by the 
        district, 52 percent of the difference between the amount of the 
        contract and the basic revenue of the district for that pupil 
        for the fraction of the school day the pupil receives services 
        under the contract; 
           (6) for secondary vocational education programs 
        school-to-work programs for children with disabilities provided 
        by a contract approved by the commissioner with public, private, 
        or voluntary agencies other than a Minnesota school district or 
        cooperative center, that are supplementary to a full educational 
        program provided by the school district, 52 percent of the 
        amount of the contract; and 
           (7) for a contract approved by the commissioner with 
        another Minnesota school district or cooperative center for 
        vocational evaluation services for children with a disability 
        for children that are not yet enrolled in grade 12, 52 percent 
        of the amount of the contract. 
           (b) If requested by a school district for school-to-work 
        programs during the base year for less than the full school 
        year, the commissioner may adjust the base revenue to reflect 
        the expenditures that would have occurred during the base year 
        had the program been operated for the full year. 
           Sec. 28.  Minnesota Statutes 1996, section 124.574, 
        subdivision 2f, is amended to read: 
           Subd. 2f.  [STATE TOTAL SECONDARY VOCATIONAL-DISABLED 
        SCHOOL-TO-WORK PROGRAM-DISABLED REVENUE.] The state total 
        secondary vocational-disabled school-to-work program-disabled 
        revenue for fiscal year 1996 1998 equals $8,520,000 $8,924,000.  
        The state total secondary vocational-disabled school-to-work 
        program-disabled revenue for fiscal year 1997 1999 equals 
        $8,830,000 $8,976,000.  The state total secondary 
        vocational-disabled school-to-work program-disabled revenue for 
        later fiscal years equals:  
           (1) the state total secondary vocational-disabled 
        school-to-work program-disabled revenue for the preceding fiscal 
        year; times 
           (2) the program growth factor; times 
           (3) the ratio of the state total average daily membership 
        for the current fiscal year to the state total average daily 
        membership for the preceding fiscal year. 
           Sec. 29.  Minnesota Statutes 1996, section 124.86, 
        subdivision 2, is amended to read: 
           Subd. 2.  [REVENUE AMOUNT.] An American Indian-controlled 
        tribal contract or grant school that is located on a reservation 
        within the state and that complies with the requirements in 
        subdivision 1 is eligible to receive tribal contract or grant 
        school aid.  The amount of aid is derived by: 
           (1) multiplying the formula allowance under section 
        124A.22, subdivision 2, less $170, times the difference between 
        (a) the actual pupil units as defined in section 124A.02, 
        subdivision 15, in average daily membership, excluding section 
        124.17, subdivision 2f, and (b) the number of pupils for the 
        current school year, weighted according to section 124.17, 
        subdivision 1, receiving benefits under section 123.933 or 
        123.935 or for which the school is receiving reimbursement under 
        section 126.23; 
           (2) adding to the result in clause (1) an amount equal to 
        the product of the formula allowance under section 124A.22, 
        subdivision 2, less $300 times the tribal contract compensation 
        revenue pupil units; 
           (3) subtracting from the result in clause (1) (2) the 
        amount of money allotted to the school by the federal government 
        through Indian School Equalization Program of the Bureau of 
        Indian Affairs, according to Code of Federal Regulations, title 
        25, part 39, subparts A to E, for the basic program as defined 
        by section 39.11, paragraph (b), for the base rate as applied to 
        kindergarten through twelfth grade, excluding small school 
        adjustments and additional weighting, but not money allotted 
        through subparts F to L for contingency funds, school board 
        training, student training, interim maintenance and minor 
        repair, interim administration cost, prekindergarten, and 
        operation and maintenance, and the amount of money that is 
        received according to section 126.23; 
           (3) (4) dividing the result in clause (2) (3) by the sum 
        of the actual pupil units in average daily membership, excluding 
        section 124.17, subdivision 2f, plus the tribal contract 
        compensation revenue pupil units; and 
           (4) (5) multiplying the sum of the actual pupil units, 
        including section 124.17, subdivision 2f, in average daily 
        membership plus the tribal contract compensation revenue pupil 
        units by the lesser of $1,500 or the sum of the result in 
        clause (3) plus $300 (4). 
           Sec. 30.  Minnesota Statutes 1996, section 124.86, is 
        amended by adding a subdivision to read: 
           Subd. 5.  [TRIBAL CONTRACT PUPIL UNITS.] Pupil units for 
        pupils enrolled in tribal contract schools shall be used only 
        for the purpose of computing tribal contract aid according to 
        this section. 
           Sec. 31.  Minnesota Statutes 1996, section 124.912, 
        subdivision 6, is amended to read: 
           Subd. 6.  [CRIME RELATED COSTS.] For taxes levied in 1991 
        and subsequent years, payable in 1992 and subsequent years, each 
        school district may make a levy on all taxable property located 
        within the school district for the purposes specified in this 
        subdivision.  The maximum amount which may be levied for all 
        costs under this subdivision shall be equal to $1 $1.50 
        multiplied by the population of the school district.  For 
        purposes of this subdivision, "population" of the school 
        district means the same as contained in section 275.14.  The 
        proceeds of the levy must be used for reimbursing the cities and 
        counties who contract with the school district for the following 
        purposes:  (1) to pay the costs incurred for the salaries, 
        benefits, and transportation costs of peace officers and 
        sheriffs for liaison services in the district's middle and 
        secondary schools; (2) to pay the costs for a drug abuse 
        prevention program as defined in Minnesota Statutes 1991 
        Supplement, section 609.101, subdivision 3, paragraph (f), in 
        the elementary schools; or (3) to pay the costs for a gang 
        resistance education training curriculum in the middle schools.  
        The school district must initially attempt to contract for these 
        services with the police department of each city or the 
        sheriff's department of the county within the school district 
        containing the school receiving the services.  If a local police 
        department or a county sheriff's department does not wish to 
        provide the necessary services, the district may contract for 
        these services with any other police or sheriff's department 
        located entirely or partially within the school district's 
        boundaries.  The levy authorized under this subdivision is not 
        included in determining the school district's levy limitations. 
           Sec. 32.  Minnesota Statutes 1996, section 124C.45, 
        subdivision 1a, is amended to read: 
           Subd. 1a.  [RESERVE REVENUE.] Each school district that is 
        a member of an area learning center must reserve revenue in an 
        amount equal to at least 90 percent of the basic district 
        average general education revenue generated by each student less 
        compensatory revenue unit times the number of pupil units 
        attending an area learning center program under this section.  
        The amount of reserved revenue under this subdivision may only 
        be spent on program costs associated with the area learning 
        center.  Compensatory revenue must be allocated according to 
        section 124A.28, subdivision 1a. 
           Sec. 33.  Minnesota Statutes 1996, section 124C.498, 
        subdivision 3, is amended to read: 
           Subd. 3.  [GRANT APPLICATION PROCESS.] (a) Any group of 
        school districts that meets the criteria required under 
        paragraph (b)(i) may apply for a magnet school grant in an 
        amount not to exceed $10,000,000 $15,000,000 for the approved 
        costs or expansion of a magnet school facility. 
           (b)(i) Any group of districts that submits an application 
        for a grant shall submit a proposal to the commissioner for 
        review and comment under section 121.15, and the commissioner 
        shall prepare a review and comment on the proposed magnet school 
        facility, regardless of the amount of the capital expenditure 
        required to design, acquire, construct, remodel, improve, 
        furnish, or equip the facility.  The commissioner must not 
        approve an application for a magnet school grant for any 
        facility unless the facility receives a favorable review and 
        comment under section 121.15 and the participating districts: 
           (1) establish a joint powers board under section 471.59 to 
        represent all participating districts and govern the magnet 
        school facility; 
           (2) design the planned magnet school facility to meet the 
        applicable requirements contained in Minnesota Rules, chapter 
        3535; 
           (3) submit a statement of need, including reasons why the 
        magnet school will facilitate integration and improve learning; 
           (4) prepare an educational plan that includes input from 
        both community and professional staff; and 
           (5) develop an education program that will improve learning 
        opportunities for students attending the magnet school. 
           (ii) The districts may develop a plan that permits social 
        service, health, and other programs serving students and 
        community residents to be located within the magnet school 
        facility.  The commissioner shall consider this plan when 
        preparing a review and comment on the proposed facility.  
           (c) When two or more districts enter into an agreement 
        establishing a joint powers board to govern the magnet school 
        facility, all member districts shall have the same powers.  
           (d) A joint powers board of participating school districts 
        established under paragraphs (b) and (c) that intends to apply 
        for a grant shall adopt a resolution stating the costs of the 
        proposed project, the purpose for which the debt is to be 
        incurred, and an estimate of the dates when the contracts for 
        the proposed project will be completed.  A copy of the 
        resolution must accompany any application for a state grant 
        under this section. 
           (e)(i) The commissioner shall examine and consider all 
        grant applications.  If the commissioner finds that any joint 
        powers district is not a qualified grant applicant, the 
        commissioner shall promptly notify that joint powers board.  The 
        commissioner shall make awards to no more than two qualified 
        applicants whose applications have been on file with the 
        commissioner more than 30 days.  
           (ii) A grant award is subject to verification by the joint 
        powers board under paragraph (f).  A grant award must not be 
        made until the participating districts determine the site of the 
        magnet school facility.  If the total amount of the approved 
        applications exceeds the amount of grant funding that is or can 
        be made available, the commissioner shall allot the available 
        amount equally between the approved applicant districts.  The 
        commissioner shall promptly certify to each qualified joint 
        powers board the amount, if any, of the grant awarded to it. 
           (f) Each grant must be evidenced by a contract between the 
        joint powers board and the state acting through the 
        commissioner.  The contract obligates the state to pay to the 
        joint powers board an amount computed according to paragraph 
        (e)(ii) and a schedule, and terms and conditions acceptable to 
        the commissioner of finance. 
           Sec. 34.  Minnesota Statutes 1996, section 126.22, 
        subdivision 8, is amended to read: 
           Subd. 8.  [ENROLLMENT VERIFICATION.] (a) For a pupil 
        attending an eligible program full time under subdivision 3, 
        paragraph (d), the department of children, families, and 
        learning shall pay 90 percent of the basic district's average 
        general education revenue less compensatory revenue of the 
        district to the eligible program and ten percent of the basic 
        district's average general education revenue less compensatory 
        revenue to the resident district within 30 days after the 
        eligible program verifies enrollment using the form provided by 
        the department.  For a pupil attending an eligible program part 
        time, basic revenue shall be reduced proportionately, according 
        to the amount of time the pupil attends the program, and the 
        payments to the eligible program and the resident district shall 
        be reduced accordingly.  A pupil for whom payment is made 
        according to this section may not be counted by any district for 
        any purpose other than computation of basic general education 
        revenue, according to section 124A.22, subdivision 2.  If 
        payment is made for a pupil under this subdivision, a school 
        district shall not reimburse a program under section 126.23 for 
        the same pupil.  Compensatory revenue shall be paid according to 
        section 124A.22, subdivision 3. 
           (b) The department of children, families, and learning 
        shall pay up to 100 percent of the basic revenue to the eligible 
        program if there is an agreement to that effect between the 
        school district and the eligible program. 
           Sec. 35.  [126.225] [ADDITIONAL REVENUE FOR HOMELESS 
        STUDENTS.] 
           In addition to revenue received under section 126.22, 
        subdivisions 7 and 8, and section 126.23, subdivision 1, a 
        district shall receive additional revenue for homeless pupils 
        who are eligible to participate in the graduation incentives 
        program according to section 126.22, subdivision 1, paragraph 
        (a), clause (9), equal to $100 per pupil unit.  The revenue 
        received under this section shall be used for expanding 
        education services to include preschool, after-school, or summer 
        school programs to provide transition and follow-up services to 
        homeless pupils who are placed or mainstreamed in a district 
        school, or to provide parent education and support services.  
        The additional revenue shall be paid to the public or nonprofit 
        school program providing services to homeless pupils.  A student 
        shall not be considered homeless under this section if the 
        student was displaced from home as a result of a natural 
        disaster. 
           Sec. 36.  Minnesota Statutes 1996, section 126.23, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AID.] If a pupil enrolls in an alternative 
        program, eligible under section 126.22, subdivision 3, paragraph 
        (d), or subdivision 3a, operated by a private organization that 
        has contracted with a school district to provide educational 
        services for eligible pupils under section 126.22, subdivision 
        2, the district contracting with the private organization must 
        reimburse the provider an amount equal to at least 90 percent of 
        the basic district's average general education less compensatory 
        revenue of the district for each pupil attending the program 
        full time per pupil unit times the number of pupil units for 
        pupils attending the program.  Compensatory revenue must be 
        allocated according to section 124A.28, subdivision 1a.  For a 
        pupil attending the program part time, basic the revenue paid to 
        the program shall be reduced proportionately, according to the 
        amount of time the pupil attends the program, and basic revenue 
        paid to the district shall be reduced accordingly.  Pupils for 
        whom a district provides reimbursement may not be counted by the 
        district for any purpose other than computation of basic 
        revenue, according to section 124A.22, subdivision 2 general 
        education revenue.  If payment is made to a district or program 
        for a pupil under this section, the department of children, 
        families, and learning shall not make a payment for the same 
        pupil under section 126.22, subdivision 8. 
           Sec. 37.  [126.256] [AMERICAN SIGN LANGUAGE.] 
           Satisfactory completion of courses in American sign 
        language in a public elementary or secondary school shall be 
        accorded equal standing with satisfactory completion of courses 
        in any world language. 
           Sec. 38.  [126.79] [LEARN AND EARN GRADUATION ACHIEVEMENT 
        PROGRAM.] 
           Subdivision 1.  [GRANT PROGRAM ESTABLISHED.] A learn and 
        earn graduation achievement grant program is established under 
        the administration of the commissioner of children, families, 
        and learning.  The purpose of the program is to aid local 
        communities in their efforts to decrease youth crime by 
        improving the secondary educational success and increasing the 
        post-secondary educational opportunities of low-income high 
        school students who reside in and attend schools in communities 
        that have a high level of poverty and juvenile crime.  The 
        commissioner shall make grants under this section to applicants 
        to establish local learn and earn programs that are 
        school-centered and that use a community-based approach that 
        provides eligible youth in grades 9 through 12 with individually 
        tailored opportunities for academic enrichment, community 
        service, and personal development that lead to a high school 
        diploma and post-secondary education. 
           Subd. 2.  [PROGRAM OUTCOME MEASURES.] The goals of the 
        learn and earn graduation achievement program are to: 
           (1) increase school attendance; 
           (2) decrease school suspensions and dropouts; 
           (3) increase youth academic achievement, measured by 
        graduation rates and post-secondary enrollment; and 
           (4) decrease juvenile crime. 
           Subd. 3.  [LOCAL PROGRAMS; APPLICATION PROCEDURE; GRANT 
        AWARDS.] The commissioner shall make grants to eligible 
        applicants to establish local learn and earn programs.  Each 
        program shall operate for at least a four-year period.  A local 
        program shall select its participants from among eligible 
        students who are entering or are in the ninth grade at the 
        inception of the program.  A program may not refill a program 
        slot with another student if a student drops out of the program. 
        Students selected to participate in the program shall be 
        considered part of the program class and students who drop out 
        may return to the program at any time prior to graduation. 
           The commissioner shall establish the application procedure 
        for awarding grants under this section.  The commissioner shall 
        begin awarding grants by September 1, 1997. 
           Subd. 4.  [GRANT ELIGIBILITY.] An applicant for a grant 
        must be a public secondary school, a nonprofit community-based 
        agency cooperating with a secondary school, area learning 
        center, or alternative learning program approved by the 
        commissioner.  Grant applicants must meet all of the following 
        criteria: 
           (1) at least 20 percent of the students at the 
        participating school or program are eligible to receive a free 
        school lunch; 
           (2) the area which the participating school or program 
        serves has a high juvenile crime rate or has experienced a 
        significant increase in juvenile crime over the past three 
        school years; 
           (3) the applicant has a designated program coordinator who 
        will coordinate school and community resources to provide 
        students with sufficient support and continuity to realize 
        program goals; and 
           (4) the applicant has established an advisory committee 
        that includes representatives of the students and families 
        served by the program and community organizations serving youth 
        and families.  The applicant may use an existing advisory 
        committee that includes this representation. 
           At least 80 percent of a local learn and earn program's 
        participating students at the inception of the program must 
        reside in households with incomes at or below the federal 
        poverty level adjusted for family size. 
           The commissioner shall give priority to funding local learn 
        and earn programs that serve those communities that have the 
        highest juvenile crime rates and the largest concentrations of 
        economically disadvantaged youth. 
           Subd. 5.  [STUDENT ELIGIBILITY.] A student is eligible to 
        participate in a local learn and earn program if the student: 
           (1) is enrolled in the participating school; 
           (2) is entering or is in the ninth grade at the inception 
        of the program; and 
           (3) resides in a household whose income is at or below the 
        federal poverty level adjusted for family size, has been 
        recommended for the program by a teacher or other community 
        member, has requested to participate, or whose participation has 
        been requested by a family member, according to a procedure to 
        be developed by the applicant. 
           Subd. 6.  [PROGRAM COMPONENTS.] Each learn and earn 
        graduation achievement program must provide the opportunity for 
        participating students to complete: 
           (1) 250 hours each year, not including regular required 
        classroom hours, in basic education competency skills; 
           (2) 250 hours each year of community service; and 
           (3) 250 hours each year of cultural enrichment and personal 
        development, including but not limited to adult mentoring; 
        participating in community cultural events; developing life 
        skills for use in the home, workplace, and community; and 
        learning to set goals, manage time, and make appropriate 
        behavior choices for varying social situations. 
           Subd. 7.  [PROGRAM INCENTIVES.] (a) Each participating 
        student shall receive a monetary stipend for each hour spent in 
        a program component activity, plus a bonus upon completion of 
        each component during each year of the program. 
           (b) An additional amount equal to or greater than each 
        student's earned stipends and bonuses must be deposited for the 
        student in a post-secondary opportunities interest-bearing 
        account, established by the commissioner through the higher 
        education services office.  A student may, upon graduation from 
        high school, use the funds accumulated for the student toward 
        the costs of attending a Minnesota post-secondary institution or 
        participating in a Minnesota post-secondary program.  Funds 
        accumulated for a student shall be available to the student from 
        the time the student graduates from high school until ten years 
        after the date the student entered the learn and earn graduation 
        achievement program.  After ten years, the commissioner shall 
        close the student's account and any remaining money in the 
        account shall revert to the general fund. 
           The commissioner shall establish a procedure for providing 
        the monetary stipends and bonuses to students.  The commissioner 
        may delegate this authority to grantees. 
           Subd. 8.  [PROGRAM COORDINATOR.] The local learn and earn 
        program coordinator must maintain contact with all participating 
        students and their families; work with the school to link 
        students with the resources needed to improve their educational 
        skills; arrange for community service and cultural enrichment 
        opportunities for students; maintain records regarding student 
        completion of program component hours; and perform other 
        administrative duties as necessary.  A program coordinator must, 
        to the extent possible, agree to remain with the program for 
        four years to provide continuity of adult contact to the 
        participating students. 
           Subd. 9.  [EVALUATION AND REPORTS.] The commissioner shall 
        collect information about participating students and a 
        demographically similar control group and shall evaluate the 
        short-term and long-term benefits participating students receive 
        from the learn and earn graduation achievement program, based on 
        the outcome measures specified in subdivision 2, and any other 
        criteria established by the commissioner as part of the grant 
        application process.  The evaluation must include a statistical 
        comparison of students participating in the program and the 
        control group.  The commissioner shall track participating 
        students and the control group for a minimum of six years from 
        the start of the program.  The commissioner shall submit a 
        preliminary report to the governor and the chairs of the senate 
        and house committees having jurisdiction over education and 
        crime prevention by December 15, 2000, regarding continuation of 
        the learn and earn graduation achievement program for 
        participating schools and expansion of the program to additional 
        schools.  The commissioner shall submit a final report by 
        December 15, 2002. 
           Sec. 39.  Minnesota Statutes 1996, section 128B.10, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [EXTENSION.] This chapter is repealed July 
        1, 1997 remains in effect until otherwise provided by law. 
           Sec. 40.  Minnesota Statutes 1996, section 245.493, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [REQUIREMENTS TO QUALIFY AS A LOCAL 
        CHILDREN'S MENTAL HEALTH COLLABORATIVE.] In order to qualify as 
        a local children's mental health collaborative and be eligible 
        to receive start-up funds, the representatives of the local 
        system of care, or at a minimum one county, one school district 
        or special education cooperative, and one mental health entity 
        must agree to the following: 
           (1) to establish a local children's mental health 
        collaborative and develop an integrated service system; and 
           (2) to commit resources to providing services through the 
        local children's mental health collaborative; and 
           (3) develop a plan to contribute funds to the children's 
        mental health collaborative. 
           Sec. 41.  Minnesota Statutes 1996, section 260A.02, 
        subdivision 3, is amended to read: 
           Subd. 3.  [CONTINUING TRUANT.] "Continuing truant" means a 
        child who is subject to the compulsory instruction requirements 
        of section 120.101 and is absent from instruction in a school, 
        as defined in section 120.05, without valid excuse within a 
        single school year for: 
           (1) three days if the child is in elementary school; or 
           (2) three or more class periods on three days if the child 
        is in middle school, junior high school, or high school. 
           A child is not a continuing truant if the child is 
        withdrawn from school by the child's parents because of a 
        dispute with the school concerning the provision of special 
        education services under the Individuals with Disabilities 
        Education Act or accommodations and modifications under the 
        Americans with Disabilities Act, if the parent makes good faith 
        efforts to provide the child educational services from any other 
        source.  No parent who withdraws a child from school during a 
        dispute with the school concerning the provision of special 
        education services or accommodations and modifications is 
        required to file home school papers, if the parent provides 
        written notice to the department of children, families, and 
        learning or the district of the plan for the child's education. 
           Nothing in this section shall prevent a school district 
        from notifying a truant child's parent or legal guardian of the 
        child's truancy or otherwise addressing a child's attendance 
        problems prior to the child becoming a continuing truant. 
           Sec. 42.  Laws 1994, chapter 647, article 7, section 18, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ELIGIBILITY; APPLICATION.] A school district or 
        a group of school districts that have entered into a joint 
        powers agreement under Minnesota Statutes, section 471.59, to 
        provide for a magnet school or magnet program is eligible to 
        apply for an educational performance improvement grant.  The 
        application shall be on a form approved by the commissioner of 
        education.  The commissioner shall make recommendations to the 
        state board of education on which districts should be considered 
        for a grant contract.  The commissioner shall give priority to 
        school districts: 
           (1) in which at least one school has received a school 
        improvement incentive grant under Minnesota Statutes 1993 
        Supplement, section 121.602, subdivision 5; and 
           (2) that demonstrate a commitment to increasing 
        accountability by using a results-oriented system for measuring 
        student achievement. 
           Sec. 43.  Laws 1994, chapter 647, article 7, section 18, 
        subdivision 3, is amended to read: 
           Subd. 3.  [CONTRACT.] The state board of education may 
        enter into a one-year contract with a school district or group 
        of school districts for the purpose of awarding an educational 
        performance improvement grant.  The state board shall award a 
        grant only for measurable gains in student achievement.  The 
        terms of the contract shall at minimum address: 
           (1) the criteria and assessments to be used in measuring 
        student achievement; 
           (2) the district's baseline level of student achievement 
        for the district or group of districts; 
           (3) the level of student achievement, desegregation or 
        diversity, or improved operations to be reached under the 
        contract; 
           (4) a timeline for determining whether the contract goals 
        have been met; and 
           (5) at the discretion of the state board, provisions 
        governing the award of a partial grant to the district or group 
        of districts if the contract goals are not fully met. 
           Sec. 44.  Laws 1995, First Special Session chapter 3, 
        article 3, section 11, subdivision 1, is amended to read: 
           Subdivision 1.  [PURPOSE.] A pilot program is established 
        to support general education classroom teachers who teach 
        children with specific learning disabilities.  The goals of the 
        pilot program are to: 
           (1) increase participation of these children in 
        noncategorical programming designed to encourage their maximum 
        potential and maintain their self-esteem; 
           (2) demonstrate results in measurable educational outcomes; 
           (3) provide alternatives to special education that focus on 
        children's educational progress and results, respond to the 
        individual child, are efficient and cost-effective, and ensure 
        the rights of eligible children and their families to due 
        process; 
           (4) increase general education's ability to educate in a 
        manner that decreases the need for pull-out programs for 
        students with specific learning disabilities; and 
           (5) implement alternative approaches to conflict 
        resolution; and 
           (6) provide assistive technology to make individualized 
        student accommodations. 
           Sec. 45.  Laws 1995, First Special Session chapter 3, 
        article 3, section 11, subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] For the purposes of this section 
        the terms defined in this subdivision have the meanings given 
        them. 
           (a) "Accommodation" means any technique that alters the 
        educational setting to enable the child to reach the child's 
        maximum potential and to demonstrate more accurately the child's 
        knowledge and educational progress.  Accommodations may include, 
        but are not limited to:  preferential seating, paraphrasing of 
        information, instructions, practice activities and directions 
        provided in a manner consistent with the child's learning style, 
        opportunity for increased response time, more frequent 
        opportunity for review, extended time to complete assignments 
        and tests, larger print for assignments or tests, special study 
        sheets, extended or untimed tests, oral testing and answering, 
        and use of assistive technology within and outside the 
        educational environment. 
           (b) "Assistive technology device" means any item, piece of 
        equipment, or product system, whether acquired commercially off 
        the shelf, modified, or customized, that is used to increase, 
        maintain, or improve functional capabilities is as defined in 
        Minnesota Statutes, section 120.187. 
           (c) "Competency" means a documented and demonstrated 
        attitude, skill, or knowledge base resulting in an ability of 
        general education personnel to provide accommodations, 
        modifications, and personalized instruction, according to the 
        eligible child's individual learning styles, within general 
        education environments. 
           (d) "Consistently available" means that education personnel 
        who demonstrate competency are site-based and designated as a 
        resource for the development and use of accommodations, 
        modifications, and personalized instruction in general education.
           (e) "Eligible children" means those children who have 
        specific learning disabilities or conditions related to these 
        disabilities according to recognized professional standards and 
        documented by appropriately licensed personnel. 
           (f) "Learner plan" means a concise written plan that is 
        based on the eligible child's documented specific learning 
        disabilities and needs; includes the eligible child's strengths 
        that may compensate for those differences and needs; provides 
        the child, the child's parent, and all general education 
        personnel responsible for direct instruction with information 
        that results in clear understanding and subsequent use of 
        accommodations, modifications, and personalized instruction; and 
        includes methods of evaluating the child's progress that are 
        consistent with learning differences, needs, strengths, 
        modifications, and accommodations, and are at intervals 
        identical to the student population of the school in which the 
        child participating in Options Plus is enrolled. 
           (g) "Modification" means any technique that alters the 
        school work required, makes it different from the school work 
        required or other students in the same course, and encourages 
        the eligible child to reach the child's maximum potential and 
        facilitate educational success.  Modifications may include, but 
        are not limited to:  copies of teacher notes and lesson plans, 
        assisted note taking, reduced or altered assignments, increased 
        assignments in areas of strength, alternative test formats, 
        modified testing, peer assistance, cooperative learning, and 
        modified grading such as documentation of progress and results. 
           (h) "Parent" means a parent, guardian, or person acting as 
        a parent of a child. 
           (i) "Personalized instruction" means direct instruction 
        designed with knowledge of the child's learning style, 
        strengths, and differences, to assist the child to gain in skill 
        areas, so the child demonstrates progress toward and outcomes 
        necessary to become a successful citizen. 
           Sec. 46.  Laws 1995, First Special Session chapter 3, 
        article 3, section 11, subdivision 5, is amended to read: 
           Subd. 5.  [USE OF FUNDS.] Options Plus pilot program grants 
        shall be used to supplement staff development funding under 
        Minnesota Statutes, section 124A.29, to train general education 
        classroom teachers to meet the needs of children with specific 
        learning disabilities and provide assistive technology devices 
        in a general education setting.  The training shall result in 
        each participating teacher achieving the following competencies: 
           (1) understanding and communicating to the parents of the 
        child the options available for instruction; 
           (2) the ability to assess the learning environment and 
        provide the necessary accommodations, modifications, and 
        personalized instruction necessary to meet the needs of the 
        child; and 
           (3) the ability to work collaboratively and in teams with 
        other teachers and support and related services staff; and 
           (4) the ability to teach children to use the assistive 
        technology devices. 
           Sec. 47.  [AMERICAN SIGN LANGUAGE RECOGNIZED AS A WORLD 
        LANGUAGE.] 
           The Minnesota state legislature recognizes American sign 
        language as a fully developed, autonomous, natural language with 
        distinct grammar, syntax, vocabulary, and cultural heritage 
        which is used by a variety of deaf, hard-of-hearing, deaf-blind 
        and hearing individuals in the United States, and hereby 
        determines that American sign language should be accorded equal 
        status with other linguistic systems in the state's public 
        elementary and secondary and higher education systems. 
           Sec. 48.  [MATCHING GRANTS FOR EDUCATION PROGRAMS SERVING 
        HOMELESS CHILDREN.] 
           A school district or a nonprofit entity contracting with a 
        school district to provide education and transition services for 
        homeless children is eligible for a matching grant for capital 
        facilities which serve homeless children and their families.  
        Grant proceeds may be used to design, furnish, equip, acquire, 
        repair, or construct a facility for providing education and 
        transition services for homeless pupils.  To obtain a grant, a 
        school district or nonprofit entity must submit an application 
        to the commissioner of children, families, and learning in the 
        form and manner the commissioner establishes.  Grants must be 
        matched by $1 of nonstate money for every $1 of grant money 
        received.  The commissioner shall take into consideration the 
        number of concentration of homeless children served by a school 
        district when awarding grants.  The commissioner may award 
        matching grants of up to $500,000 per school district. 
           Sec. 49.  [OSSEO LEVY.] 
           For levies payable in 1998 only, independent school 
        district No. 279, Osseo, may levy a tax in an amount not to 
        exceed $800,000.  The proceeds of this levy must be used to 
        provide instructional services for at-risk children. 
           Sec. 50.  [PINE POINT SCHOOL.] 
           Notwithstanding Minnesota Statutes, section 128B.10, 
        subdivision 1, the other provisions of Minnesota Statutes, 
        chapter 128B, remain in effect after June 30, 1997.  Actions 
        taken pursuant to Minnesota Statutes, chapter 128B, after June 
        30, 1997, and before the effective date of this section are 
        valid and ratified by this section. 
           Sec. 51.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated, 
        unless otherwise indicated, from the general fund to the 
        department of children, families, and learning for the fiscal 
        years designated.  
           Subd. 2.  [AMERICAN INDIAN LANGUAGE AND CULTURE PROGRAMS.] 
        For grants to American Indian language and culture education 
        programs according to Minnesota Statutes, section 126.54, 
        subdivision 1: 
             $591,000     .....     1998
             $591,000     .....     1999
           The 1998 appropriation includes $59,000 for 1997 and 
        $532,000 for 1998.  
           The 1999 appropriation includes $59,000 for 1998 and 
        $532,000 for 1999.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 3.  [AMERICAN INDIAN EDUCATION.] (a) For certain 
        American Indian education programs in school districts: 
             $175,000       .....     1998
             $175,000       .....     1999
           The 1998 appropriation includes $17,000 for 1997 and 
        $158,000 for 1998.  
           The 1999 appropriation includes $17,000 for 1998 and 
        $158,000 for 1999.  
           (b) These appropriations are available for expenditure with 
        the approval of the commissioner of the department of children, 
        families, and learning. 
           (c) The commissioner must not approve the payment of any 
        amount to a school district or school under this subdivision 
        unless that school district or school is in compliance with all 
        applicable laws of this state. 
           (d) Up to the following amounts may be distributed to the 
        following schools and school districts for each fiscal year:  
        $54,800, Pine Point School; $9,800 to independent school 
        district No. 166, Cook county; $14,900 to independent school 
        district No. 432, Mahnomen; $14,200 to independent school 
        district No. 435, Waubun; $42,200 to independent school district 
        No. 707, Nett Lake; and $39,100 to independent school district 
        No. 38, Red Lake.  These amounts must be spent only for the 
        benefit of American Indian pupils and to meet established state 
        educational standards or statewide requirements. 
           (e) Before a district or school can receive money under 
        this subdivision, the district or school must submit, to the 
        commissioner, evidence that it has complied with the uniform 
        financial accounting and reporting standards act, Minnesota 
        Statutes, sections 121.904 to 121.917. 
           Subd. 4.  [AMERICAN INDIAN POST-SECONDARY PREPARATION 
        GRANTS.] For American Indian post-secondary preparation grants 
        according to Minnesota Statutes, section 124.481: 
             $857,000     .....     1998
             $857,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 5.  [AMERICAN INDIAN SCHOLARSHIPS.] For American 
        Indian scholarships according to Minnesota Statutes, section 
        124.48: 
             $1,600,000     .....     1998 
             $1,600,000     .....     1999 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 6.  [INDIAN TEACHER PREPARATION GRANTS.] (a) For 
        joint grants to assist Indian people to become teachers: 
             $190,000     .....     1998 
             $190,000     .....     1999 
           (b) Up to $70,000 each year is for a joint grant to the 
        University of Minnesota at Duluth and the Duluth school district.
           (c) Up to $40,000 each year is for a joint grant to each of 
        the following: 
           (1) Bemidji state university and the Red Lake school 
        district; 
           (2) Moorhead state university and a school district located 
        within the White Earth reservation; and 
           (3) Augsburg college, independent school district No. 625, 
        St. Paul, and the Minneapolis school district. 
           (d) Money not used for students at one location may be 
        transferred for use at another location. 
           (e) Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 7.  [TRIBAL CONTRACT SCHOOLS.] For tribal contract 
        school aid according to Minnesota Statutes, section 124.86: 
             $2,287,000     .....     1998
             $2,797,000     .....     1999
           The 1998 appropriation includes $91,000 for 1997 and 
        $2,196,000 for 1998. 
           The 1999 appropriation includes $244,000 for 1998 and 
        $2,553,000 for 1999. 
           Subd. 8.  [EARLY CHILDHOOD PROGRAMS AT TRIBAL SCHOOLS.] For 
        early childhood family education programs at tribal contract 
        schools: 
             $68,000     .....     1998 
             $68,000     .....     1999 
           Subd. 9.  [AMERICAN SIGN LANGUAGE; TEACHER EDUCATION 
        HEARING.] To assist school districts in educating teachers in 
        American sign language: 
             $13,000     .....     1998
             $12,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 10.  [MEXICAN ORIGIN EDUCATION GRANTS.] For grants 
        for a Mexican origin education pilot grant program: 
             $50,000     .....     1998
             $25,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 11.  [LAY ADVOCATES.] To pay or reimburse lay 
        advocates for their time and expense as provided in Minnesota 
        Statutes, section 120.17: 
             $10,000     .....     1998
           This appropriation is available until June 30, 1999. 
           Subd. 12.  [OPTIONS PLUS PILOT GRANTS.] For grants to 
        school districts for options plus pilot programs: 
             $150,000    .....     1998 
           Each grant shall not exceed $50,000. 
           This appropriation is available until June 30, 1999.  
           Subd. 13.  [MAGNET SCHOOL GRANTS.] For magnet school and 
        program grants: 
             $5,750,000     .....     1998 
             $1,750,000     .....     1999 
           These amounts may be used for magnet school programs and 
        acquisition and betterment of magnet school facilities according 
        to Minnesota Statutes, section 124C.498. 
           Subd. 14.  [INTEGRATION PROGRAMS.] For grants according to: 
        minority fellowship grants according to Laws 1994, chapter 647, 
        article 8, section 29; minority teacher incentives according to 
        Minnesota Statutes, section 124.278; teachers of color grants 
        according to Minnesota Statutes, section 125.623; and cultural 
        exchange grants according to Minnesota Statutes, section 126.43: 
             $1,000,000     .....     1998
             $1,000,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           In awarding teacher of color grants, priority must be given 
        to districts that have students who are currently in the process 
        of completing their academic program. 
           Subd. 15.  [SPECIAL EDUCATION AID.] For special education 
        aid according to Minnesota Statutes, section 124.32: 
             $282,505,000   .....     1998 
             $382,519,000   .....     1999 
           The 1998 appropriation includes $24,346,000 for 1997 and 
        $258,159,000 for 1998.  
           The 1999 appropriation includes $28,684,000 for 1998 and 
        $353,835,000 for 1999.  
           Subd. 16.  [AID FOR CHILDREN WITH A DISABILITY.] For aid 
        according to Minnesota Statutes, section 124.32, subdivision 6, 
        for children with a disability placed in residential facilities 
        within the district boundaries for whom no district of residence 
        can be determined: 
             $586,000       .....     1998 
             $644,000       .....     1999 
           If the appropriation for either year is insufficient, the 
        appropriation for the other year is available.  Any balance in 
        the first year does not cancel but is available in the second 
        year. 
           Subd. 17.  [TRAVEL FOR HOME-BASED SERVICES.] For aid for 
        teacher travel for home-based services according to Minnesota 
        Statutes, section 124.32, subdivision 2b: 
             $107,000       .....     1998 
             $111,000       .....     1999 
           The 1998 appropriation includes $8,000 for 1997 and $99,000 
        for 1998.  
           The 1999 appropriation includes $10,000 for 1998 and 
        $101,000 for 1999.  
           Subd. 18.  [SPECIAL EDUCATION EXCESS COST AID.] For excess 
        cost aid: 
             $25,974,000    .....     1998 
             $44,984,000    .....     1999 
           The 1998 appropriation includes $1,242,000 for 1997 and 
        $24,732,000 for 1998.  
           The 1999 appropriation includes $2,748,000 for 1998 and 
        $42,236,000 for 1999. 
           Subd. 19.  [TARGETED NEEDS AID.] For targeted needs aid: 
             $47,225,000    .....     1998 
             $ 2,899,000    .....     1999 
           (a) Of the 1998 amount, $930,000 is for 1997 limited 
        English proficiency aid and $13,694,000 is for 1998 limited 
        English proficiency aid.  Of the 1998 amount, $1,364,000 is for 
        1997 assurance of mastery aid and $12,393,000 is for 1998 
        assurance of mastery aid.  Of the 1998 amount, $18,844,000 is 
        for 1998 integration aid. 
           (b) Of the 1999 amount, $1,522,000 is for 1998 limited 
        English proficiency aid and $0 is for 1999 limited English 
        proficiency aid.  Of the 1999 amount, $1,377,000 is for 1998 
        assurance of mastery aid and $0 is for 1999 assurance of mastery 
        aid.  
           (c) As a condition of receiving a grant, each district must 
        continue to report its costs according to the uniform financial 
        accounting and reporting system.  As a further condition of 
        receiving a grant, each district must submit a report to the 
        chairs of the education committees of the legislature about the 
        actual expenditures it made for integration using the grant 
        money including achievement results.  These grants may be used 
        to transport students attending a nonresident district under 
        Minnesota Statutes, section 120.062, to the border of the 
        resident district.  A district may allocate a part of the grant 
        to the transportation fund for this purpose. 
           Subd. 20.  [SCHOOL-TO-WORK PROGRAMS; STUDENTS WITH 
        DISABILITIES.] For aid for school-to-work programs for pupils 
        with disabilities according to Minnesota Statutes, section 
        124.574: 
             $7,044,000     .....     1998 
             $7,985,000     .....     1999 
           The 1998 appropriation includes $618,000 for 1997 and 
        $6,426,000 for 1998.  
           The 1999 appropriation includes $713,000 for 1998 and 
        $7,272,000 for 1999.  
           Subd. 21.  [SPECIAL PROGRAMS EQUALIZATION AID.] For special 
        education levy equalization aid according to Minnesota Statutes, 
        section 124.321: 
             $11,195,000     .....     1998
             $ 5,780,000     .....     1999
           The 1998 appropriation includes $1,783,000 for 1997 and 
        $9,412,000 for 1998.  
           The 1999 appropriation includes $1,045,000 for 1998 and 
        $4,735,000 for 1999. 
           Subd. 22.  [INTEGRATION AID.] For integration aid: 
             $26,124,000       .....     1999 
           This appropriation is based on an entitlement of 
        $29,026,000. 
           Subd. 23.  [CENTRAL MINNESOTA AREA LEARNING CENTER.] For a 
        grant to two or more of the following school districts, 
        independent school district Nos. 47, Sauk Rapids; 51, Foley; 
        738, Holdingford; 739, Kimball; 742, St. Cloud; 748, Sartell; 
        and 750, Cold Spring, that form a joint powers agreement under 
        Minnesota Statutes, section 471.59, to establish the central 
        Minnesota area learning center: 
             $130,000     .....     1998 
           This appropriation is available until June 30, 1999. 
           Subd. 24.  [ADDITIONAL REVENUE FOR HOMELESS STUDENTS.] For 
        additional revenue for homeless students according to Minnesota 
        Statutes, section 126.225: 
             $180,000     .....     1998
             $200,000     .....     1999
           The 1998 appropriation includes $0 for 1997 and $180,000 
        for 1998. 
           The 1999 appropriation includes $20,000 for 1998 and 
        $180,000 for 1999. 
           Subd. 25.  [MATCHING GRANTS FOR EDUCATION PROGRAMS SERVING 
        HOMELESS CHILDREN.] For matching grants for education programs 
        for homeless children: 
             $400,000     .....     1998
           This appropriation is available until June 30, 1999. 
           Subd. 26.  [LOW-INCOME CONCENTRATION GRANTS.] For 
        low-income concentration grants under Laws 1994, chapter 647, 
        article 8, section 43: 
             $1,000,000       .....     1998 
           The commissioner shall also award a grant to a school 
        building that has at least 20 percent students of color and 
        where at least 20 percent of the students are eligible for free 
        or reduced-price lunch if that school building is located in a 
        city where all the school buildings in that city are eligible 
        for low-income concentration grants. 
           Subd. 27.  [NETT LAKE.] For grants to independent school 
        district No. 707, Nett Lake: 
             $99,000     .....     1998
             $60,000     .....     1999 
           $39,000 in 1998 is for a grant to independent school 
        district No. 707, Nett Lake, to reimburse the district for 
        property and boiler insurance premiums paid in fiscal years 1996 
        and 1997. 
           $30,000 in 1998 and $30,000 in 1999 are for grants to 
        independent school district No. 707, Nett Lake, to pay property 
        insurance and boiler insurance premiums, and insurance premiums 
        under Minnesota Statutes, section 466.06. 
           $30,000 in 1998 and $30,000 in 1999 are for grants to 
        independent school district No. 707, Nett Lake, for the payment 
        of obligations of the school district for unemployment 
        compensation.  The appropriation must be paid to the appropriate 
        state agency for such purposes in the name of the school 
        district. 
           Subd. 28.  [NETT LAKE MEDIA SPECIALIST.] For a grant to 
        independent school district No. 707, Nett Lake, for a media 
        specialist for preschool through grade 6: 
                $35,000     .....     1998 
           Subd. 29.  [FIRST GRADE PREPAREDNESS.] (a) For grants for 
        the first grade preparedness program under Minnesota Statutes, 
        section 124.2613, and for school sites that have provided a 
        full-day kindergarten option for kindergarten students enrolled 
        in fiscal years 1996 and 1997: 
             $5,000,000     .....     1998 
             $5,000,000     .....     1999 
           (b) To be a qualified site, licensed teachers must have 
        taught the optional full-day kindergarten classes.  A district 
        that charged a fee for students participating in an optional 
        full-day program is eligible to receive the grant to provide 
        full-day kindergarten for all students as required by Minnesota 
        Statutes, section 124.2613, subdivision 4.  Districts with 
        eligible sites must apply to the commissioner of children, 
        families, and learning for a grant. 
           (c) This appropriation must first be used to fund programs 
        operating during the 1996-1997 school year under paragraph (b) 
        and Minnesota Statutes, section 124.2613.  Any remaining funds 
        may be used to expand the number of sites providing first grade 
        preparedness programs. 
           Subd. 30.  [EDUCATION PERFORMANCE IMPROVEMENT GRANTS.] For 
        additional grants under Laws 1994, chapter 647, article 7, 
        section 18, as amended: 
             $1,100,000     .....     1998 
           Consistent with the provisions of Laws 1994, chapter 647, 
        article 7, section 18, as amended, a grant recipient that is a 
        group of school districts that have entered into a joint powers 
        agreement may use the grant proceeds to enhance student 
        achievement and metropolitan desegregation.  Grant recipients 
        must comply with the achievement plan according to Minnesota 
        Statutes, section 123.951, subdivision 4. 
           This appropriation is available until June 30, 1999. 
           Subd. 31.  [CENTER FOR THE VICTIMS OF TORTURE.] For the 
        center for victims of torture to hire a full-time psychologist 
        to address behavioral problems exhibited by students in the 
        public schools who are survivors of war traumas: 
             $60,000     .....     1998
             $60,000     .....     1999
           Subd. 32.  [ADOLESCENT PARENT PROGRAM GRANTS.] For 
        adolescent parent program grants: 
             $500,000     .....     1998
           Up to 2-1/2 percent of the appropriation may be used for 
        evaluation of the programs. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 33.  [LEARN AND EARN GRADUATION ACHIEVEMENT PROGRAM.] 
        For the learn and earn graduation achievement program according 
        to Minnesota Statutes, section 126.79: 
             $1,000,000     .....     1998
             $1,000,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 34.  [ONE ROOM SCHOOLHOUSE.] For a grant to 
        independent school district No. 690, Warroad, to operate the 
        Angle Inlet School: 
             $25,000     .....     1998
             $25,000     .....     1999
           Subd. 35.  [SPECIAL PROGRAM; FETAL ALCOHOL SYNDROME.] The 
        sum indicated in this subdivision is appropriated from the 
        general fund to the commissioner of health for the fiscal year 
        designated.  To prevent and reduce harm from fetal alcohol 
        syndrome and fetal alcohol effect: 
             $500,000       .....     1998 
           This amount is added to the appropriation for the same 
        purpose in Laws 1997, chapter 203, article 1, section 3, 
        subdivision 2.  
           This appropriation is available until June 30, 1999. 
           Sec. 52.  [REPEALER.] 
           Subdivision 1.  [JULY 1, 1996.] Minnesota Statutes 1996, 
        section 124.3201, subdivisions 2a and 2b, are retroactively 
        repealed effective July 1, 1996. 
           Subd. 2.  [JUNE 1, 1997.] Minnesota Statutes 1996, section 
        124.17, subdivision 5, is retroactively repealed effective June 
        1, 1997. 
           Sec. 53.  [EFFECTIVE DATE.] 
           (a) Sections 4, 23, and 24 are effective for fiscal year 
        1999. 
           (b) Sections 6, 7, 21, and 25 are effective retroactively 
        to July 1, 1996.  
           (c) Sections 32 and 36 are effective for the 1997-1998 
        school year and thereafter.  
           (d) If this act is enacted on or after July 1, 1997, all 
        sections in this article except for those sections listed in 
        paragraphs (a) to (c) are effective the day following final 
        enactment. 
                                   ARTICLE 3 
                              LIFEWORK DEVELOPMENT 
           Section 1.  [121.498] [MINNESOTA CAREER INFORMATION 
        SYSTEM.] 
           (a) The department of children, families, and learning, 
        through the Minnesota career information system (MCIS), may 
        provide career information to, including, but not limited to, 
        school districts and other educational organizations, employment 
        and training services, human service agencies, libraries, and 
        families.  The department shall collect fees necessary to 
        recover all expenditures related to the operation of the 
        Minnesota career information system. 
           (b) Grants and other legislative funds may be accepted and 
        used for the improvement or operation of the Minnesota career 
        information system.  All receipts shall be deposited in a 
        special account in the special revenue fund that shall be 
        carried over at the end of each fiscal year.  The money in the 
        account, along with any interest earned, is appropriated to the 
        commissioner of children, families, and learning for the 
        Minnesota career information system and must be for the sole use 
        and benefit of the system.  The department shall recognize that 
        the Minnesota career information system operates under a 
        self-supporting directive, and accordingly, must provide 
        sufficient administrative latitude within the confines of law to 
        enable the system to operate effectively. 
           Sec. 2.  Minnesota Statutes 1996, section 121.615, 
        subdivision 2, is amended to read: 
           Subd. 2.  [CREATION OF FOUNDATION.] There is created the 
        Minnesota school-to-work student organization foundation.  The 
        purpose of the foundation shall be to promote vocational student 
        organizations and applied leadership opportunities in Minnesota 
        public and nonpublic schools through public-private 
        partnerships.  The foundation shall be a nonprofit 
        organization.  The board of directors of the foundation and 
        activities of the foundation are under the direction of 
        the department of children, families, and learning state board 
        of education.  
           Sec. 3.  Minnesota Statutes 1996, section 121.615, 
        subdivision 3, is amended to read: 
           Subd. 3.  [BOARD OF DIRECTORS.] The board of directors of 
        the school-to-work student organization foundation shall consist 
        of: 
           (1) chairs or designees from the board of directors of FFA 
        (formerly Future Farmers of America), Future Leaders of 
        America/Future Homemakers of America, post-secondary agriculture 
        students, home economics related occupations, Health Occupations 
        Student Association, Distributive Education Clubs of America, 
        Delta Upsilon Chi, Secondary Vocational Industrial Clubs of 
        America, Post-secondary Vocational Industrial Clubs of America, 
        Secondary Business Professionals of America, and Post-secondary 
        Business Professionals of America; 
           (2) four members from business and industry appointed by 
        the governor; and 
           (3) five students representing diverse vocational areas, 
        three of whom are appointed by the commissioner of the 
        department of children, families, and learning and two of whom 
        are appointed by the chancellor of the Minnesota state colleges 
        and universities with the advice of the executive councils of 
        each vocational education student organization. 
           (1) seven members appointed by the board of directors of 
        the school-to-work student organizations and chosen so that each 
        represents one of the following career areas:  agriculture, 
        family and consumer sciences, service occupations, health 
        occupations, marketing, business, and technical/industrial; 
           (2) seven members from business, industry, and labor 
        appointed by the governor to staggered terms and chosen so that 
        each represents one of the following career areas:  agriculture, 
        family and consumer sciences, service occupations, health 
        occupations, marketing, business, and technical/industrial; 
           (3) five students or alumni of school-to-work student 
        organizations representing diverse career areas, three from 
        secondary student organizations, and two from post-secondary 
        student organizations.  The students or alumni shall be 
        appointed by the criteria and process agreed upon by the 
        executive directors of the student-to-work organizations; and 
           (4) four members from education appointed by the governor 
        to staggered terms and chosen so that each represents one of the 
        following groups:  school district level administrators, 
        secondary school administrators, middle school administrators, 
        and post-secondary administrators. 
           Executive directors of vocational education student 
        organizations are ex officio, nonvoting members of the board. 
           Sec. 4.  Minnesota Statutes 1996, section 121.615, 
        subdivision 5, is amended to read: 
           Subd. 5.  [POWERS AND DUTIES.] The foundation may: 
           (1) identify and plan common goals and priorities for the 
        various school-to-work student organizations in Minnesota; 
           (2) publish brochures or booklets relating to the purposes 
        of the foundation and collect reasonable fees for the 
        publications; 
           (3) seek and receive public and private money, grants, and 
        in-kind services and goods from nonstate sources for the 
        purposes of the foundation, without complying with section 7.09, 
        subdivision 1; 
           (4) contract with consultants on behalf of the 
        school-to-work student organizations; and 
           (5) plan, implement, and expend money for awards and other 
        forms of recognition for school-to-work student activities 
        programs; and 
           (6) identifying an appropriate name for the foundation. 
           Sec. 5.  Minnesota Statutes 1996, section 121.615, 
        subdivision 6, is amended to read: 
           Subd. 6.  [CONTRACTS.] The foundation board of directors 
        shall review and approve foundation personnel and programming 
        contracts each contract of the board.  Each contract of the 
        foundation board shall be subject to the same review and 
        approval procedures as a contract of the state board of 
        education. 
           Sec. 6.  Minnesota Statutes 1996, section 121.615, 
        subdivision 7, is amended to read: 
           Subd. 7.  [FOUNDATION STAFF.] The commissioner of the 
        department of children, families, and learning state board of 
        education shall appoint the executive director of the foundation 
        from three candidates nominated and submitted by the foundation 
        board of directors and, as necessary, other staff who shall 
        perform duties and have responsibilities solely related to the 
        foundation.  The employees appointed are not state employees 
        under chapter 43A, but are covered under section 3.736.  The 
        employees may participate in the state health and state 
        insurance plans for employees in unclassified service.  The 
        employees shall be supervised by the executive director. 
           The commissioner shall appoint from the office of lifework 
        development a liaison to the foundation board. 
           Sec. 7.  Minnesota Statutes 1996, section 121.615, 
        subdivision 8, is amended to read: 
           Subd. 8.  [PUBLIC FUNDING.] The commissioner of the 
        department of children, families, and learning state shall 
        identify and secure appropriate sources of state and federal 
        funding from various state agencies, including, but not limited 
        to, Minnesota state colleges and universities, for the operation 
        and development of basic staffing of the foundation and 
        individual student school-to-work student organizations at the 
        state level. 
           Sec. 8.  Minnesota Statutes 1996, section 121.615, 
        subdivision 9, is amended to read: 
           Subd. 9.  [PRIVATE FUNDING.] The foundation shall seek 
        private resources to supplement the allocated state and 
        federal available public money.  Individuals, businesses, and 
        other organizations may contribute to the foundation in any 
        manner specified by the board of directors.  All money received 
        shall be administered by the board of directors. 
           Sec. 9.  Minnesota Statutes 1996, section 121.615, 
        subdivision 10, is amended to read: 
           Subd. 10.  [REPORT.] The board of directors of the 
        foundation shall submit an annual report and assessment to the 
        office of lifework development and on the progress of its 
        activities to the state board of education and to the board of 
        trustees of the Minnesota state colleges and universities.  The 
        annual report shall contain a financial report for the preceding 
        year.  The foundation shall submit a biennium report to the 
        legislature before February 15, in the odd-numbered year. 
           Sec. 10.  Minnesota Statutes 1996, section 121.703, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DUTIES.] (a) The commission shall: 
           (1) develop, with the assistance of the governor, the 
        commissioner of children, families, and learning, and affected 
        state agencies, a comprehensive state plan to provide services 
        under sections 121.701 to 121.710 and federal law; 
           (2) actively pursue public and private funding sources for 
        services, including funding available under federal law; 
           (3) coordinate volunteer service-learning programs within 
        the state; 
           (4) develop, in cooperation with the workforce development 
        council and the commissioner of children, families, and 
        learning, volunteer service-learning programs, including 
        curriculum, materials, and methods of instruction; 
           (5) work collaboratively with the workforce development 
        council, the commissioner of children, families, and learning, 
        schools, public and private agencies, for-profit and nonprofit 
        employers, and labor unions to identify mentoring and 
        service-learning opportunities, solicit and recruit participants 
        for these programs, and disseminate information on the programs; 
           (6) administer the youth works grant program under sections 
        121.704 to 121.709, with assistance from the commissioner of 
        children, families, and learning and the executive director of 
        the higher education services office, including soliciting and 
        approving grant applications from eligible organizations, and 
        administering individual postservice benefits; 
           (7) establish an evaluation plan for programs developed and 
        services provided under sections 121.701 to 121.710; 
           (8) report to the governor, commissioner of children, 
        families, and learning, and legislature; 
           (9) provide oversight and support for school, campus, and 
        community-based service programs; and 
           (10) administer the federal AmeriCorps program. 
           (b) Nothing in sections 121.701 to 121.710 precludes an 
        organization from independently seeking public or private 
        funding to accomplish purposes similar to those described in 
        paragraph (a). 
           (c) The commissioner of children, families, and learning 
        shall consult with commission members before the commissioner 
        selects the executive director for the commission, who shall 
        serve in the unclassified service. 
           Sec. 11.  Minnesota Statutes 1996, section 124.193, is 
        amended to read: 
           124.193 [PROHIBITED AID AND LEVIES.] 
           Subdivision 1.  [GENERAL PROHIBITION.] Unless specifically 
        permitted in the provision authorizing an aid or a levy, 
        cooperative units of government defined in section 123.35, 
        subdivision 19b, paragraph (d), are prohibited from making a 
        property tax levy or qualifying for or receiving any form of 
        state aid except that a cooperative unit may apply for and 
        receive a grant on behalf of its members as provided in 
        subdivisions 2 and 3. 
           Subd. 2.  [GRANTS.] A cooperative unit may apply for and 
        receive a grant on behalf of its members. 
           Subd. 3.  [ALLOCATION FROM MEMBERS.] By July 15 of each 
        year, a school district may, by board resolution, request the 
        department to make a payment to a third party.  The total sum of 
        the payments for the year may not exceed the lesser of (a) the 
        district's general education aid for the fiscal year beginning 
        July 1, according to sections 124A.036, subdivision 5, and 
        124A.23, subdivision 4, or (b) an amount equal to $100 times the 
        fund balance pupil units for the fiscal year beginning July 1.  
        By July 30 of each year, the school district must report to the 
        commissioner the amount allocated.  The amount shall be paid to 
        the third party according to section 124.195, subdivision 15.  
        Amounts paid to third parties under this subdivision shall be 
        recognized and reported as revenues and expenditures on the 
        school district's books of account under sections 121.904 and 
        121.906. 
           Sec. 12.  Minnesota Statutes 1996, section 124.195, is 
        amended by adding a subdivision to read: 
           Subd. 15.  [PAYMENTS TO THIRD PARTIES.] Notwithstanding 
        subdivision 3, 90 percent of the amounts under section 124.193, 
        subdivision 3, shall be paid in equal installments on August 30, 
        December 30, and March 30, with a ten percent final adjustment 
        payment on October 30 of the next fiscal year. 
           Sec. 13.  Minnesota Statutes 1996, section 124.574, 
        subdivision 1, is amended to read: 
           Subdivision 1.  The purpose of this section is to provide a 
        method to fund programs for secondary vocational 
        education school-to-work programs for children with a 
        disability.  As used in this section, the term "children with a 
        disability" shall have the meaning ascribed to it in section 
        120.03. 
           Sec. 14.  Minnesota Statutes 1996, section 124.574, 
        subdivision 5, is amended to read: 
           Subd. 5.  The aid provided pursuant to this section shall 
        be paid only for services rendered as designated in subdivision 
        2 or for the costs designated in subdivision 3 which are 
        incurred in secondary vocational education programs 
        school-to-work programs for children with a disability which are 
        approved by the commissioner of children, families, and learning 
        and operated in accordance with rules promulgated by the state 
        board.  These rules shall be subject to the restrictions 
        provided in section 124.573, subdivision 3.  The procedure for 
        application for approval of these programs shall be as provided 
        in section 124.32, subdivisions 7 and 10, and the application 
        review process shall be conducted by the vocational education 
        section of the state office of lifework development in the 
        department. 
           Sec. 15.  Minnesota Statutes 1996, section 124.574, 
        subdivision 6, is amended to read: 
           Subd. 6.  All aid pursuant to this section shall be paid to 
        the district or cooperative center providing the services.  All 
        aid received by a district or center from any source for 
        secondary vocational education school-to-work programs for 
        children with a disability shall be utilized solely for that 
        purpose. 
           Sec. 16.  Minnesota Statutes 1996, section 124.574, 
        subdivision 9, is amended to read: 
           Subd. 9.  [REVENUE ALLOCATION FROM COOPERATIVE CENTERS AND 
        INTERMEDIATE DISTRICTS.] For purposes of this section and 
        section 124.321, a cooperative center or an intermediate 
        district shall allocate its approved expenditures for secondary 
        vocational programs school-to-work programs for children with a 
        disability among participating school districts.  Aid for 
        secondary vocational programs school-to-work programs for 
        children with a disability for services provided by a 
        cooperative or intermediate district shall be paid to the 
        participating school districts. 
           Sec. 17.  Minnesota Statutes 1996, section 124C.46, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROGRAM FOCUS.] The programs and services 
        of a center must focus on academic and learning skills, applied 
        learning opportunities, trade and vocational skills, work-based 
        learning opportunities, work experience, youth service to the 
        community, and transition services.  Applied learning, 
        work-based learning, and service learning may best be developed 
        in collaboration with a local education and transitions 
        partnership.  In addition to offering programs, the center shall 
        coordinate the use of other available educational services, 
        social services, health services, and post-secondary 
        institutions in the community and services area.  
           Sec. 18.  [126.685] [LIFEWORK DEVELOPMENT PLAN.] 
           A school district may require students to develop and 
        maintain a record of all students' lifework development 
        activities and work toward achieving the profile of learning.  
        This record includes, but is not limited to, student's goals, 
        skills, abilities, and interests, as well as information on 
        service learning experiences, out-of-school learning 
        experiences, and career-related experiences, such as job 
        shadowing, career mentoring, internships, apprenticeships, 
        entrepreneurship, and other work-based learning activities that 
        may be used to fulfill the profile of learning.  The ongoing 
        record assists students in choosing their school-based courses, 
        researching and exploring career options, and realizing their 
        role as citizens and their goals as lifelong learners.  Each 
        school year, the student, the student's parent or guardian, 
        school and career counselors, and other appropriately trained 
        school personnel shall review the student's plan to ensure that 
        the plan is updated and reflects the student's changing life 
        goals and aspirations.  The plan serves as a continuous record 
        of future education and training options necessary to achieve 
        the student's lifework goal. 
           Sec. 19.  Minnesota Statutes 1996, section 268.665, 
        subdivision 2, is amended to read: 
           Subd. 2.  [MEMBERSHIP.] The governor's workforce 
        development council is composed of 32 33 members appointed by 
        the governor.  The members may be removed pursuant to section 
        15.059.  In selecting the representatives of the council, the 
        governor shall ensure that 50 percent of the members come from 
        nominations provided by local workforce councils.  Local 
        education representatives shall come from nominations provided 
        by local education to employment partnerships.  The 32 members 
        shall represent the following sectors:  
           (a) State agencies:  the following individuals shall serve 
        on the council:  
           (1) commissioner of the Minnesota department of economic 
        security; 
           (2) commissioner of the Minnesota department of children, 
        families, and learning; 
           (3) commissioner of the Minnesota department of human 
        services; and 
           (4) commissioner of the Minnesota department of trade and 
        economic development. 
           (b) Business and industry:  six individuals shall represent 
        the business and industry sectors of Minnesota. 
           (c) Organized labor:  six individuals shall represent labor 
        organizations of Minnesota. 
           (d) Community-based organizations:  four individuals shall 
        represent community-based organizations of Minnesota.  
        Community-based organizations are defined by the Job Training 
        Partnership Act as private nonprofit organizations that are 
        representative of communities or significant segments of 
        communities and that provide job training services, agencies 
        serving youth, agencies serving individuals with disabilities, 
        agencies serving displaced homemakers, union-related 
        organizations, and employer-related nonprofit organizations and 
        organizations serving nonreservation Indians and tribal 
        governments. 
           (e) Education:  five six individuals shall represent the 
        education sector of Minnesota as follows:  
           (1) one individual shall represent local public secondary 
        education; 
           (2) one individual shall have expertise in design and 
        implementation of school-based service-learning; 
           (3) one individual shall represent post-secondary 
        education; 
           (4) one individual shall represent secondary/post-secondary 
        vocational institutions; and 
           (5) the chancellor of the board of trustees of the 
        Minnesota state colleges and universities; and 
           (6) one individual shall have expertise in agricultural 
        education. 
           (f) Other:  two individuals shall represent other 
        constituencies including: 
           (1) units of local government; and 
           (2) applicable state or local programs. 
           The speaker and the minority leader of the house of 
        representatives shall each appoint a representative to serve as 
        an ex officio member of the council.  The majority and minority 
        leaders of the senate shall each appoint a senator to serve as 
        an ex officio member of the council.  After January 1, 1997, the 
        Minnesota director of the corporation for national service shall 
        also serve as an ex officio member.  
           (g) Appointment:  each member shall be appointed for a term 
        of three years from the first day of January or July immediately 
        following their appointment.  Elected officials shall forfeit 
        their appointment if they cease to serve in elected office.  
           (h) Members of the council are compensated as provided in 
        section 15.059, subdivision 3. 
           Sec. 20.  Laws 1993, chapter 146, article 5, section 20, is 
        amended to read: 
           Sec. 20.  [REPEALER.] 
           Sections 6 to 12 are repealed June 30, 1998 2001. 
           Sec. 21.  [DAWSON-BOYD ADULT FARM MANAGEMENT LEVY.] 
           In addition to other levies, independent school district 
        No. 378, Dawson-Boyd, may levy an amount up to $132,000 for the 
        unreimbursed costs of an adult farm management program.  This 
        amount may be levied over a period of three years. 
           Sec. 22.  [SOUTHWEST STAR CONCEPT SCHOOL.] 
           Subdivision 1.  [PILOT PROJECT.] The Southwest Star Concept 
        School pilot project is created.  The purpose of the project is 
        to serve as a model for the state of Minnesota demonstrating the 
        capability of a small school district to provide a curriculum 
        focusing on applied learning and teaching methodology allowing 
        students to reach high levels of performance on the state 
        graduation standards. 
           Subd. 2.  [ACTIVITIES.] The school board of independent 
        school district No. 330, Heron Lake-Okabena, must develop the 
        Southwest Star Concept School, including its academic framework, 
        goals, and delivery system in consultation with community 
        members, teachers, and parents. 
           Subd. 3.  [REPORT.] Independent school district No. 330, 
        Heron Lake-Okabena, shall conduct an ongoing study of the pilot 
        project.  The ongoing study shall evaluate and compare outcomes 
        and student performance to other similarly situated school 
        districts and measure changes in outcomes and student 
        performance within the school over time.  The school district 
        shall annually report its results to the legislature by February 
        15 of each year.  A final report must be issued by February 15, 
        2002. 
           Sec. 23.  [MODEL LIFEWORK LEARNING SITES.] 
           Subdivision 1.  [PURPOSE.] Lifework learning sites are 
        established to develop and model practices of lifework learning. 
        Lifework learning includes vocational education, preparation for 
        work, family and community responsibilities, and lifelong 
        learning. 
           Subd. 2.  [DEFINITION; ELIGIBILITY.] A "lifework learning 
        site" means a site that focuses on lifework learning and models 
        school-to-work practices.  A lifework learning site may include, 
        but is not limited to, a site that is: 
           (1) a public school, including a charter school, an 
        alternative program, or a post-secondary institution; 
           (2) located in or connected to a school; or 
           (3) colocated with an education, commercial, government, or 
        community enterprise. 
           Subd. 3.  [DESIGNATION.] To be designated a "lifework 
        learning site," a site must: 
           (1) develop, implement, and model practices and techniques 
        consistent with lifework learning and school-to-work performance 
        indicators; 
           (2) train school and nonschool staff on lifework learning 
        and school-to-work practices and methodologies; 
           (3) provide real world, school-based, work-based, and 
        service-based learning experiences, integrated with academic 
        studies that meet Minnesota's graduation standards; 
           (4) assess and evaluate lifework learning and 
        school-to-work practices; and 
           (5) disseminate materials and information about lifework 
        learning site activities using the state's information 
        clearinghouse on lifework learning and school-to-work. 
           Subd. 4.  [APPLICATION.] (a) A lifework learning site 
        applicant must be a partner in a local/regional school-to-work 
        partnership.  To be designated a lifework learning site and 
        eligible for a grant, the applicant must submit an application 
        to the governor's workforce council in the form and manner the 
        council prescribes. 
           (b) With the advice and recommendation of the vocational 
        high school planning committee appointed under Laws 1995, First 
        Special Session chapter 3, article 3, section 12, the council 
        must select lifework learning sites that: 
           (1) are committed to lifework learning and school-to-work 
        practices and methodologies; 
           (2) are capable and willing to work with the local/regional 
        school-to-work partnership, and make resources available for the 
        ongoing function of the site; 
           (3) implement reaching and learning strategies that support 
        the graduation standards and innovative teaching and learning 
        practices; 
           (4) develop and provide ongoing training for school and 
        nonschool partners; 
           (5) use existing education, commercial, government, or 
        community facilities; 
           (6) demonstrate how the lifework learning site will serve 
        all kindergarten through grade 12 students within the community; 
        and 
           (7) demonstrate a long-term financial plan to sustain the 
        lifework learning site. 
           Subd. 5.  [START-UP GRANT AWARDS,] In order for the site to 
        receive a start-up grant, the site must match the grant amount 
        with an equal amount of funding or in-kind contributions from 
        federal, local, or private sources.  The grant award shall not 
        exceed $200,000 for a site.  The site shall use the grant for 
        the start-up costs of the lifework learning site. 
           Subd. 6.  [REPORT.] A grant recipient shall report annually 
        for three years to the commissioner of children, families, and 
        learning on implementation of the lifework learning site and the 
        site's ability to deliver model school-to-work instruction and 
        learning. 
           Sec. 24.  [THIRD-PARTY PAYMENTS.] 
           For fiscal year 1998 only, the department to make a 
        third-party payment under section 12 at a school board's request 
        if that request is made within 60 days of the effective date of 
        this section. 
           Sec. 25.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated. 
           Subd. 2.  [SECONDARY VOCATIONAL EDUCATION AID.] For 
        secondary vocational education aid according to Minnesota 
        Statutes, section 124.573: 
             $11,617,000     .....     1998 
             $11,596,000     .....     1999 
           The 1998 appropriation includes $1,180,000 for 1997 and 
        $10,437,000 for 1998.  
           The 1999 appropriation includes $1,159,000 for 1998 and 
        $10,437,000 for 1999.  
           Subd. 3.  [YOUTHWORKS PROGRAM.] For funding youthworks 
        programs according to Minnesota Statutes, sections 121.701 to 
        121.710: 
             $1,838,000     .....     1998 
             $1,838,000     .....     1999 
           The commissioner may allocate up to $50,000 of the 
        appropriation for the cost of administering the program. 
           A grantee organization may provide health and child care 
        coverage to the dependents of each participant enrolled in a 
        full-time youth works program to the extent such coverage is not 
        otherwise available. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 4.  [EDUCATION AND EMPLOYMENT TRANSITIONS PROGRAM 
        GRANTS.] For education and employment transitions program: 
             $4,750,000      .....      1998
             $4,750,000      .....      1999 
           $500,000 each year is for development of MnCEPs, an 
        Internet-based education and employment information system.  
        These are one-time funds. 
           $1,225,000 in fiscal year 1998 and $1,250,000 in fiscal 
        year 1999 is for a rebate program for qualifying employers who 
        employ less than 250 employees, who offer youth internships to 
        educators.  An employer may apply for a rebate of up to $500 for 
        each paid youth internship and each educator internship, and up 
        to $3,000 for each paid youth apprenticeship.  The commissioner 
        shall determine the application and payment process. 
           $450,000 each year is for youth apprenticeship program 
        grants. 
           $225,000 each year is for youth entrepreneurship grants 
        under Minnesota Statutes, section 121.72.  Of this amount, 
        $25,000 each year is for the high school student 
        entrepreneurship program in independent school district No. 175, 
        Westbrook.  This appropriation shall be used for expenses, 
        including, but not limited to, salaries, travel, seminars, 
        equipment purchases, contractual expenses, and other expenses 
        related to the student-run business. 
           $125,000 each year is for youth employer grants under Laws 
        1995, First Special Session chapter 3, article 4, section 28. 
           $150,000 each year is for parent and community awareness 
        training. 
           $825,000 each year is for the development of career 
        assessment benchmarks, lifework portfolios, industry skill 
        standards, curriculum development, career academies, and career 
        programs for elementary, middle school, and at-risk learners. 
           $400,000 each year is for state level activities, including 
        the governor's workforce council. 
           $275,000 each year is for development of occupational 
        information. 
           $300,000 each year is for a grant to be made available to a 
        county government that has established school-to-work projects 
        with schools located in a city of the first class.  These grants 
        must be used to expand the number of at-risk students 
        participating in these school-to-work projects.  Priority must 
        be given to projects that demonstrate collaboration between 
        private employers, collective bargaining representatives, school 
        officials, and the county government and which prepare at-risk 
        students for long-term employment with private sector employers 
        paying a minimum of 150 percent of the federal poverty level for 
        a family of four and with the majority of their employees in 
        collective bargaining units. 
           $250,000 each year is for agricultural school-to-work 
        grants. 
           $25,000 is for a grant to the Minnesota Historical Society 
        for money canceled in fiscal year 1997. 
           Subd. 5.  [MINNESOTA SCHOOL-TO-WORK STUDENT ORGANIZATION 
        FOUNDATION.] For the Minnesota school-to-work student 
        organization foundation under Minnesota Statutes, section 
        121.615: 
             $375,000       .....     1998 
             $375,000       .....     1999 
           This appropriation is available until June 30, 1999. 
           Subd. 6.  [SOUTHWEST STAR CONCEPT SCHOOL.] For a grant to 
        independent school district No. 330, Heron Lake-Okabena, to 
        establish the Southwest Star Concept School: 
             $193,000     .....     1998
           This appropriation may be used for equipment, activities 
        beyond the classroom walls, professional planning assistance, 
        monitoring, evaluating, and reporting activities related to the 
        case study prepared in section 22. 
           Subd. 7.  [WORKSTUDY STUDENT COMPENSATION.] For enabling 
        school districts to pay the employer's share of work study 
        students compensation under Minnesota Statutes, section 
        136A.233, subdivision 3: 
             $50,000        .....     1998 
             $50,000        .....     1999 
           Money shall be available to districts upon request until 
        the appropriation is exhausted.  The commissioner may establish 
        an application procedure for allocating the money to districts. 
           Subd. 8.  [LIFEWORK LEARNING SITES.] For lifework learning 
        sites according to section 23: 
             $500,000     .....     1998
             $500,000     .....     1999
           Of this amount, $150,000 shall be awarded for a start-up 
        grant to the Mid-State education district No. 6979 for a job 
        shadowing program and internships at Camp Ripley.  
           Any balance remaining in the first year does not cancel but 
        is available in the second year.  
           Sec. 26.  [EFFECTIVE DATE.] 
           (a) Sections 11 and 12 are effective for revenue for fiscal 
        years 1998 and later. 
           (b) If this act is enacted on or after July 1, 1997, all 
        sections in this article except for those sections listed in 
        paragraph (a) are effective the day following final enactment. 
                                   ARTICLE 4 
              EDUCATION ORGANIZATION, COOPERATION, AND FACILITIES 
           Section 1.  Minnesota Statutes 1996, section 120.0621, 
        subdivision 5a, is amended to read: 
           Subd. 5a.  [TUITION PAYMENTS.] In each odd-numbered year, 
        before March 1, the state board of education commissioner shall 
        agree to rates of tuition for Minnesota elementary and secondary 
        pupils attending in other states for the next two fiscal 
        years when the other state agrees to negotiate tuition rates.  
        The board commissioner shall negotiate equal, reciprocal rates 
        with the designated authority in each state for pupils who 
        reside in an adjoining state and enroll in a Minnesota school 
        district.  The rates must be at least equal to the tuition 
        specified in section 120.08, subdivision 1.  If the other state 
        does not agree to negotiate a general tuition rate, a Minnesota 
        school district may negotiate a tuition rate with the school 
        district in the other state that sends a pupil to or receives a 
        pupil from the Minnesota school district.  The tuition rate for 
        a pupil with a disability must be equal to the actual cost of 
        instruction and services provided.  The resident district of a 
        Minnesota pupil attending in another state under this section 
        must pay the amount of tuition agreed upon in this section to 
        the district of attendance, prorated on the basis of the 
        proportion of the school year attended. 
           Sec. 2.  Minnesota Statutes 1996, section 120.0621, 
        subdivision 6, is amended to read: 
           Subd. 6.  [EFFECTIVE IF RECIPROCAL.] This section is 
        effective with respect to South Dakota upon enactment of 
        provisions by South Dakota that the commissioner determines are 
        essentially similar to the provisions for Minnesota pupils in 
        this section.  After July 1, 1993, this section is effective 
        with respect to any other bordering state upon enactment of 
        provisions by the bordering state that the commissioner 
        determines are essentially similar to the provisions for 
        Minnesota pupils in this section. 
           Sec. 3.  Minnesota Statutes 1996, section 120.0621, is 
        amended by adding a subdivision to read: 
           Subd. 7.  [APPEAL TO THE COMMISSIONER.] If a Minnesota 
        school district cannot agree with an adjoining state on a 
        tuition rate for a Minnesota student attending school in that 
        state and that state has met the requirements in subdivision 6, 
        then the student's parent or guardian may request that the 
        commissioner agree on a tuition rate for the student.  The 
        Minnesota school district must pay the amount of tuition the 
        commissioner agrees upon. 
           Sec. 4.  Minnesota Statutes 1996, section 121.15, is 
        amended by adding a subdivision to read: 
           Subd. 1b.  [INDOOR AIR QUALITY RESOURCES; COMMISSIONER'S 
        ROLE.] As part of the consultation under subdivision 1, the 
        commissioner shall provide each school district with information 
        concerning indoor air quality. 
           Sec. 5.  Minnesota Statutes 1996, section 121.15, 
        subdivision 6, is amended to read: 
           Subd. 6.  [REVIEW AND COMMENT.] A school district, a 
        special education cooperative, or a cooperative unit of 
        government, as defined in section 123.35, subdivision 19b, 
        paragraph (d), must not initiate an installment contract for 
        purchase or a lease agreement, hold a referendum for bonds, nor 
        solicit bids for new construction, expansion, or remodeling of 
        an educational facility that requires an expenditure in excess 
        of $400,000 per school site prior to review and comment by the 
        commissioner.  A school board shall not separate portions of a 
        single project into components to avoid the requirements of this 
        subdivision.  
           Sec. 6.  Minnesota Statutes 1996, section 121.15, 
        subdivision 7, is amended to read: 
           Subd. 7.  [INFORMATION REQUIRED.] A school board proposing 
        to construct a facility described in subdivision 6 shall submit 
        to the commissioner a proposal containing information including 
        at least the following: 
           (a) the geographic area proposed to be served, whether 
        within or outside the boundaries of the school district; 
           (b) the people proposed to be served, including census 
        findings and projections for the next ten years of the number of 
        preschool and school-aged people in the area; 
           (c) the reasonably anticipated need for the facility or 
        service to be provided; 
           (d) a description of the construction in reasonable detail, 
        including:  the expenditures contemplated; the estimated annual 
        operating cost, including the anticipated salary and number of 
        new staff necessitated by the proposal; and an evaluation of the 
        energy efficiency and effectiveness of the construction, 
        including estimated annual energy costs; and a description of 
        the telephone capabilities of the facility and its classrooms; 
           (e) a description of existing facilities within the area to 
        be served and within school districts adjacent to the area to be 
        served; the extent to which existing facilities or services are 
        used; the extent to which alternate space is available, 
        including other school districts, post-secondary institutions, 
        other public or private buildings, or other noneducation 
        community resources; and the anticipated effect that the 
        facility will have on existing facilities and services; 
           (f) the anticipated benefit of the facility to the area; 
           (g) if known, the relationship of the proposed construction 
        to any priorities that have been established for the area to be 
        served; 
           (h) the availability and manner of financing the facility 
        and the estimated date to begin and complete the facility; 
           (i) desegregation requirements that cannot be met by any 
        other reasonable means; 
           (j) the relationship of the proposed facility to the 
        cooperative integrated learning needs of the area; and 
           (k) the effects of the proposed facility on the district's 
        operating budget; 
           (l) the level of collaboration at the facility between the 
        district and other governmental or nonprofit entities; and 
           (m) the extent to which the district has minimized 
        administrative overhead among facilities. 
           Sec. 7.  Minnesota Statutes 1996, section 121.15, is 
        amended by adding a subdivision to read: 
           Subd. 7a.  [INDOOR AIR QUALITY.] A school board seeking a 
        review and comment under this section must submit information 
        demonstrating to the commissioner's satisfaction that: 
           (1) indoor air quality issues have been considered; and 
           (2) the architects and engineers designing the facility 
        will have professional liability insurance. 
           Sec. 8.  [121.1501] [SCHOOL FACILITY COMMISSIONING.] 
           Subdivision 1.  [APPLICATION.] This section applies to the 
        installation or retrofitting of heating, ventilation, and air 
        conditioning systems for which review and comment of the project 
        under section 121.15 has been requested after the effective date 
        of this section. 
           Subd. 2.  [SYSTEM INSPECTOR.] For purposes of this section, 
        system inspector means: 
           (1) a Minnesota-licensed architect or engineer; or 
           (2) properly qualified testing and balancing agency or 
        individual. 
           Subd. 3.  [CERTIFICATION.] Prior to occupying or 
        reoccupying a school facility affected by this section, a school 
        board or its designee shall submit a document prepared by a 
        system inspector to the building official or to the 
        commissioner, verifying that the facility's heating, 
        ventilation, and air conditioning system has been installed and 
        operates according to design specifications. 
           Subd. 4.  [OCCUPANCY.] If the document submitted by the 
        school board to the local building official or the commissioner 
        does not demonstrate to that official's satisfaction that the 
        heating, ventilation, and air conditioning system has been 
        installed correctly or that the system is not operating at a 
        level to meet design specifications, the official or 
        commissioner may allow up to one year of occupancy while the 
        heating, ventilation, and air conditioning system is improved to 
        a level that is considered satisfactory by the system inspector. 
           Sec. 9.  Minnesota Statutes 1996, section 124.2445, is 
        amended to read: 
           124.2445 [PURCHASE OF CERTAIN EQUIPMENT.] 
           The board of a school district may issue general obligation 
        certificates of indebtedness or capital notes subject to the 
        school district debt limits to purchase:  (a) vehicles, 
        computers, telephone systems, cable equipment, photocopy and 
        office equipment, technological equipment for instruction, and 
        other capital equipment having an expected useful life at least 
        as long as the terms of the certificates or notes; and (b) 
        computer hardware and software, without regard to its expected 
        useful life, whether bundled with machinery or equipment or 
        unbundled, together with application development services and 
        training related to the use of the computer.  The certificates 
        or notes must be payable in not more than five years and must be 
        issued on the terms and in the manner determined by the board.  
        The certificates or notes may be issued by resolution and 
        without the requirement for an election.  The certificates or 
        notes are general obligation bonds for purposes of section 
        124.755.  A tax levy must be made for the payment of the 
        principal and interest on the certificates or notes, in 
        accordance with section 475.61, as in the case of bonds.  The 
        sum of the tax levies under this section and section 124.2455 
        for each year must not exceed the amount of the district's total 
        operating capital revenue for the year the initial debt service 
        levies are certified.  The district's general education levy for 
        each year must be reduced by the sum of (1) the amount of the 
        tax levies for debt service certified for each year for payment 
        of the principal and interest on the certificates or notes as 
        required by section 475.61., and (2) any excess amount in the 
        debt redemption fund used to retire certificates or notes issued 
        after April 1, 1997, other than amounts used to pay capitalized 
        interest.  A district using an excess amount in the debt 
        redemption fund to retire the certificates or notes shall report 
        the amount used for this purpose to the commissioner by July 15 
        of the following fiscal year.  A district having an outstanding 
        capital loan under section 124.431 or an outstanding debt 
        service loan under section 124.42 must not use an excess amount 
        in the debt redemption fund to retire the certificates or notes. 
           Sec. 10.  Minnesota Statutes 1996, section 124.2455, is 
        amended to read: 
           124.2455 [BONDS FOR CERTAIN CAPITAL FACILITIES.] 
           (a) In addition to other bonding authority, with approval 
        of the commissioner, a school district may issue general 
        obligation bonds for certain capital projects under this 
        section.  The bonds must be used only to make capital 
        improvements including: 
           (1) under section 124A.22, subdivision 11, total operating 
        capital revenue uses specified in clauses (4), (6), (7), (8), 
        (9), and (10); 
           (2) the cost of energy modifications; 
           (3) improving handicap accessibility to school buildings; 
        and 
           (4) bringing school buildings into compliance with life and 
        safety codes and fire codes.  
           (b) Before a district issues bonds under this subdivision, 
        it must publish notice of the intended projects, the amount of 
        the bond issue, and the total amount of district indebtedness.  
           (c) A bond issue tentatively authorized by the board under 
        this subdivision becomes finally authorized unless a petition 
        signed by more than 15 percent of the registered voters of the 
        school district is filed with the school board within 30 days of 
        the board's adoption of a resolution stating the board's 
        intention to issue bonds.  The percentage is to be determined 
        with reference to the number of registered voters in the school 
        district on the last day before the petition is filed with the 
        school board.  The petition must call for a referendum on the 
        question of whether to issue the bonds for the projects under 
        this section.  The approval of 50 percent plus one of those 
        voting on the question is required to pass a referendum 
        authorized by this section. 
           (d) The bonds must be paid off within ten years of 
        issuance.  The bonds must be issued in compliance with chapter 
        475, except as otherwise provided in this section.  A tax levy 
        must be made for the payment of principal and interest on the 
        bonds in accordance with section 475.61.  The sum of the tax 
        levies under this section and section 124.2455 for each year 
        must not exceed the amount of the district's total operating 
        capital revenue for the year the initial debt service levies are 
        certified.  The district's general education levy for each year 
        must be reduced by the sum of (1) the amount of the tax levies 
        for debt service certified for each year for payment of the 
        principal and interest on the bonds., and (2) any excess amount 
        in the debt redemption fund used to retire bonds issued after 
        April 1, 1997, other than amounts used to pay capitalized 
        interest.  A district using an excess amount in the debt 
        redemption fund to retire the bonds shall report the amount used 
        for this purpose to the commissioner by July 15 of the following 
        fiscal year.  A district having an outstanding capital loan 
        under section 124.431 or an outstanding debt service loan under 
        section 124.42 must not use an excess amount in the debt 
        redemption fund to retire the bonds. 
           (e) Notwithstanding paragraph (d), bonds issued by a 
        district within the first five years following voter approval of 
        a combination according to section 122.243, subdivision 2, must 
        be paid off within 20 years of issuance.  All the other 
        provisions and limitation of paragraph (d) apply. 
           Sec. 11.  Minnesota Statutes 1996, section 124.2727, 
        subdivision 6d, is amended to read: 
           Subd. 6d.  [REVENUE USES.] (a) A district must place its 
        district cooperation revenue in a reserved account and may only 
        use the revenue to purchase goods and services from entities 
        formed for cooperative purposes or to otherwise provide 
        educational services in a cooperative manner. 
           (b) A district that was a member of an intermediate school 
        district organized pursuant to chapter 136D on July 1, 1994 July 
        1, 1996, must place its district cooperation revenue in a 
        reserved account and must allocate a portion of the reserved 
        revenue for instructional services from entities formed for 
        cooperative services for special education programs and 
        secondary vocational programs.  The allocated amount is equal to 
        the levy made according to section 124.2727, subdivision 6, for 
        taxes payable in 1994 divided by the actual pupil units in the 
        intermediate school district for fiscal year 1995 times the 
        number of actual pupil units in the school district in 1995.  
        The district must use 5/11 of the revenue for special education 
        and 6/11 of the revenue for secondary vocational education.  The 
        district must demonstrate that the revenue is being used to 
        provide the full range of special education and secondary 
        vocational programs and services available to each child served 
        by the intermediate.  The secondary vocational programs and 
        service must meet the requirements established in an 
        articulation agreement developed between the state board of 
        education and the board of trustees of the Minnesota state 
        colleges and universities. 
           (c) A district that was not a member of an intermediate 
        district organized under chapter 136D on July 1, 1994, must 
        spend at least $9 per pupil unit of its district cooperation 
        revenue on secondary vocational programs. 
           Sec. 12.  Minnesota Statutes 1996, section 124.42, 
        subdivision 4, is amended to read: 
           Subd. 4.  Each district receiving a debt service loan shall 
        levy for debt service in that year and each year thereafter, 
        until all its debts to the fund are paid, (a) the amount of its 
        maximum effort debt service levy, or (b) the amount of its 
        required debt service levy less the amount of any debt service 
        loan in that year, whichever is greater.  Whenever the maximum 
        effort debt service levy is greater the district shall remit to 
        the commissioner, within ten days after its receipt of the last 
        regular tax distribution in the year in which it is collected, 
        that portion of the maximum effort debt service tax collections, 
        including penalties and interest, which exceeds the required 
        debt service levy.  The district shall remit payments to the 
        commissioner according to section 124.45.  On or before 
        September 1 30 in each year the commissioner shall notify the 
        county auditor of each county containing taxable property 
        situated within the school district of the amount of the maximum 
        effort debt service levy of the district for that year, and said 
        county auditor or auditors shall extend upon the tax rolls an ad 
        valorem tax upon all taxable property within the district in the 
        aggregate amount so certified.  
           Sec. 13.  Minnesota Statutes 1996, section 124.431, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DISTRICT REQUEST FOR REVIEW AND COMMENT.] A 
        school district or a joint powers district that intends to apply 
        for a capital loan must submit a proposal to the commissioner 
        for review and comment according to section 121.15 on or before 
        July 1 of an odd-numbered year.  The commissioner must prepare a 
        review and comment on the proposed facility, regardless of the 
        amount of the capital expenditure required to construct the 
        facility.  In addition to the information provided under section 
        121.15, subdivision 7, the commissioner shall require that 
        predesign packages comparable to those required under section 
        16B.335 be prepared by the applicant school district.  The 
        predesign packages must be sufficient to define the scope, cost, 
        and schedule of the project and must demonstrate that the 
        project has been analyzed according to appropriate space needs 
        standards and also consider the following criteria in 
        determining whether to make a positive review and comment.  
           (a) To grant a positive review and comment the commissioner 
        must determine that all of the following conditions are met: 
           (1) the facilities are needed for pupils for whom no 
        adequate facilities exist or will exist; 
           (2) the district will serve, on average, at least 80 pupils 
        per grade or is eligible for elementary or secondary sparsity 
        revenue; 
           (3) no form of cooperation with another district would 
        provide the necessary facilities; 
           (4) the facilities are comparable in size and quality to 
        facilities recently constructed in other districts that have 
        similar enrollments; 
           (5) the facilities are comparable in size and quality to 
        facilities recently constructed in other districts that are 
        financed without a capital loan; 
           (6) the district is projected to maintain or increase its 
        average daily membership over the next five years or is eligible 
        for elementary or secondary sparsity revenue; 
           (7) the current facility poses a threat to the life, 
        health, and safety of pupils, and cannot reasonably be brought 
        into compliance with fire, health, or life safety codes; 
           (8) the district has made a good faith effort, as evidenced 
        by its maintenance expenditures, to adequately maintain the 
        existing facility during the previous ten years and to comply 
        with fire, health, and life safety codes and state and federal 
        requirements for handicapped accessibility; 
           (9) the district has made a good faith effort to encourage 
        integration of social service programs within the new facility; 
        and 
           (10) evaluations by school boards of adjacent districts 
        have been received. 
           (b) The commissioner may grant a negative review and 
        comment if: 
           (1) the state demographer has examined the population of 
        the communities to be served by the facility and determined that 
        the communities have not grown during the previous five years; 
           (2) the state demographer determines that the economic and 
        population bases of the communities to be served by the facility 
        are not likely to grow or to remain at a level sufficient, 
        during the next ten years, to ensure use of the entire facility; 
           (3) the need for facilities could be met within the 
        district or adjacent districts at a comparable cost by leasing, 
        repairing, remodeling, or sharing existing facilities or by 
        using temporary facilities; 
           (4) the district plans do not include cooperation and 
        collaboration with health and human services agencies and other 
        political subdivisions; or 
           (5) if the application is for new construction, an existing 
        facility that would meet the district's needs could be purchased 
        at a comparable cost from any other source within the area. 
           Sec. 14.  Minnesota Statutes 1996, section 124.431, 
        subdivision 11, is amended to read: 
           Subd. 11.  [CONTRACT.] (a) Each capital loan must be 
        evidenced by a contract between the school district and the 
        state acting through the commissioner.  The contract must 
        obligate the state to reimburse the district, from the maximum 
        effort school loan fund, for eligible capital expenses for 
        construction of the facility for which the loan is granted, an 
        amount computed as provided in subdivision 8.  The commissioner 
        must receive from the school district a certified resolution of 
        the school board estimating the costs of construction and 
        reciting that contracts for construction of the facilities for 
        which the loan is granted have been awarded and that bonds of 
        the district have been issued and sold in the amount necessary 
        to pay all estimated costs of construction in excess of the 
        amount of the loan.  The contract must obligate the district to 
        repay the loan out of the excesses of its maximum effort debt 
        service levy over its required debt service levy, including 
        interest at a rate equal to the weighted average annual rate 
        payable on Minnesota state school loan bonds issued for the 
        project and disbursed to the districts on a reimbursement basis, 
        but in no event less than 3-1/2 percent per year on the 
        principal amount from time to time unpaid. 
           (b) The district shall each year, as long as it is indebted 
        to the state, levy for debt service (a) (i) the amount of its 
        maximum effort debt service levy or (b) (ii) the amount of its 
        required debt service levy, whichever is greater, except as the 
        required debt service levy may be reduced by a loan under 
        section 124.42.  On November 20 of each year each district 
        having an outstanding capital loan shall compute the excess 
        amount in the debt redemption fund.  The commissioner shall 
        prescribe the form and calculation to be used in computing the 
        excess amount.  A completed copy of this form shall be sent to 
        the commissioner before December 1 of each year.  The 
        commissioner may recompute the excess amount and shall promptly 
        notify the district of the recomputed amount.  On December 15 of 
        each year, the district shall remit to the commissioner an 
        amount equal to the excess amount in the debt redemption fund.  
        When the maximum effort debt service levy is greater, the 
        district shall remit to the commissioner within ten days after 
        its receipt of the last regular tax distribution in each year, 
        that part of the debt service tax collections, including 
        penalties and interest that exceeded the required debt service 
        levy.  The district shall remit payments to the commissioner 
        according to section 124.45. 
           (c) The commissioner shall supervise the collection of 
        outstanding accounts due the fund and may, by notice to the 
        proper county auditor, require the maximum levy to be made as 
        required in this subdivision.  Interest on capital loans must be 
        paid on December 15 of the year after the year the loan is 
        granted and annually in later years.  On or before September 1 
        30 in each year the commissioner shall notify the county auditor 
        of each county containing taxable property situated within the 
        school district of the amount of the maximum effort debt service 
        levy of the district for that year.  The county auditor or 
        auditors shall extend upon the tax rolls an ad valorem tax upon 
        all taxable property within the district in the aggregate amount 
        so certified. 
           Sec. 15.  Minnesota Statutes 1996, section 124.45, is 
        amended to read: 
           124.45 [PAYMENT AND APPLICATIONS OF PAYMENT.] 
           Subdivision 1.  [PAYMENT.] (a) On November 20 of each year, 
        each district having an outstanding capital loan or debt service 
        loan shall compute the excess amount in the debt redemption 
        fund.  The commissioner shall prescribe the form and calculation 
        to be used in computing the excess amount.  A completed copy of 
        this form shall be sent to the commissioner before December 1 of 
        each year.  The commissioner may recompute the excess amount and 
        shall promptly notify the district of the recomputed amount. 
           (b) On December 15 of each year, the district shall remit 
        to the commissioner an amount equal to the greater of: 
           (i) the excess amount in the debt redemption fund; or 
           (ii) the amount by which the maximum effort debt service 
        levy exceeds the required debt service levy for that calendar 
        year. 
        Any late payments shall be assessed an interest charge using the 
        interest rates specified for the debt service notes and capital 
        loan contracts. 
           (c) If a payment required under the maximum effort school 
        aid law is not made within 30 days, the commissioner may reduce 
        any subsequent payments due the district under chapters 124 and 
        124A by the amount due, after providing written notice to the 
        district. 
           Subd. 2.  [APPLICATION OF PAYMENTS.] The commissioner shall 
        apply payments received from collections of maximum effort debt 
        service levies in excess of required debt service levies of a 
        district on its debt service notes and capital loan 
        contracts under the maximum effort school aid law and aids 
        withheld according to subdivision 1, paragraph (b), as follows:  
        First, to payment of interest accrued on its notes, if any; 
        second, to interest on its contracts, if any; third, toward 
        principal of its notes, if any; and last, toward principal of 
        its contracts, if any.  While more than one note or more than 
        one contract is held, priority of payment of interest shall be 
        given to the one of earliest date, and after interest accrued on 
        all notes is paid, similar priority shall be given in the 
        application of any remaining amount to the payment of 
        principal.  In any year when the receipts from a district are 
        not sufficient to pay the interest accrued on any of its notes 
        or contracts, the deficiency shall be added to the principal, 
        and the commissioner shall notify the district and each county 
        auditor concerned of the new amount of principal of the note or 
        contract.  
           Sec. 16.  [124.825] [HISTORIC BUILDING REVENUE.] 
           Subdivision 1.  [ELIGIBILITY.] A district that maintains a 
        school building listed on the National Register of Historic 
        Places is eligible for historic building revenue. 
           Subd. 2.  [REVENUE.] A district's historic building revenue 
        is equal to $100 times the number of actual pupil units served 
        in the school building. 
           Subd. 3.  [LEVY.] To obtain historic building revenue, a 
        district may levy an amount, not to exceed the district's 
        revenue, equal to the district's revenue authority for that year 
        times the lesser of one or the ratio of the adjusted net tax 
        capacity divided by its actual pupil units for that school year 
        to $10,000. 
           Subd. 4.  [AID.] A district's historic building aid is 
        equal to the difference between the district's revenue minus the 
        levy.  If a district does not levy the entire amount permitted, 
        the district's aid must be reduced in proportion to the amount 
        levied. 
           Sec. 17.  Minnesota Statutes 1996, section 124.83, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [HEALTH AND SAFETY PROGRAM.] To receive 
        health and safety revenue for any fiscal year a district must 
        submit to the commissioner of children, families, and learning 
        an application for aid and levy by the date determined by the 
        commissioner.  The application may be for hazardous substance 
        removal, fire and life safety code repairs, labor and industry 
        regulated facility and equipment violations, and health, safety, 
        and environmental management, including indoor air quality 
        management.  The application must include a health and safety 
        program adopted by the school district board.  The program must 
        include the estimated cost, per building, of the program by 
        fiscal year. 
           Sec. 18.  Minnesota Statutes 1996, section 124.83, 
        subdivision 2, is amended to read: 
           Subd. 2.  [CONTENTS OF PROGRAM.] A district must adopt a 
        health and safety program.  The program must include plans, 
        where applicable, for hazardous substance removal, fire and life 
        safety code repairs, regulated facility and equipment 
        violations, and health, safety, and environmental management, 
        including indoor air quality management.  
           (a) A hazardous substance plan must contain provisions for 
        the removal or encapsulation of asbestos from school buildings 
        or property, asbestos-related repairs, cleanup and disposal of 
        polychlorinated biphenyls found in school buildings or property, 
        and cleanup, removal, disposal, and repairs related to storing 
        heating fuel or transportation fuels such as alcohol, gasoline, 
        fuel, oil, and special fuel, as defined in section 296.01.  If a 
        district has already developed a plan for the removal or 
        encapsulation of asbestos as required by the federal Asbestos 
        Hazard Emergency Response Act of 1986, the district may use a 
        summary of that plan, which includes a description and schedule 
        of response actions, for purposes of this section.  The plan 
        must also contain provisions to make modifications to existing 
        facilities and equipment necessary to limit personal exposure to 
        hazardous substances, as regulated by the federal Occupational 
        Safety and Health Administration under Code of Federal 
        Regulations, title 29, part 1910, subpart Z; or is determined by 
        the commissioner to present a significant risk to district staff 
        or student health and safety as a result of foreseeable use, 
        handling, accidental spill, exposure, or contamination. 
           (b) A fire and life safety plan must contain a description 
        of the current fire and life safety code violations, a plan for 
        the removal or repair of the fire and life safety hazard, and a 
        description of safety preparation and awareness procedures to be 
        followed until the hazard is fully corrected. 
           (c) A facilities and equipment violation plan must contain 
        provisions to correct health and safety hazards as provided in 
        department of labor and industry standards pursuant to section 
        182.655.  
           (d) A health, safety, and environmental management plan 
        must contain a description of training, record keeping, hazard 
        assessment, and program management as defined in section 124.829.
           (e) A plan to test for and mitigate radon produced hazards. 
           (f) A plan to monitor and improve indoor air quality. 
           Sec. 19.  Minnesota Statutes 1996, section 124.91, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [TO LEASE BUILDING OR LAND.] (a) When a 
        district finds it economically advantageous to rent or lease a 
        building or land for any instructional purposes or for school 
        storage or furniture repair, and it determines that 
        the operating capital expenditure facilities revenues revenue 
        authorized under sections 124.243 and section 124A.22, 
        subdivision 10, are insufficient for this purpose, it may apply 
        to the commissioner for permission to make an additional capital 
        expenditure levy for this purpose.  An application for 
        permission to levy under this subdivision must contain financial 
        justification for the proposed levy, the terms and conditions of 
        the proposed lease, and a description of the space to be leased 
        and its proposed use.  
           (b) The criteria for approval of applications to levy under 
        this subdivision must include:  the reasonableness of the price, 
        the appropriateness of the space to the proposed activity, the 
        feasibility of transporting pupils to the leased building or 
        land, conformity of the lease to the laws and rules of the state 
        of Minnesota, and the appropriateness of the proposed lease to 
        the space needs and the financial condition of the district.  
        The commissioner must not authorize a levy under this 
        subdivision in an amount greater than the cost to the district 
        of renting or leasing a building or land for approved purposes.  
        The proceeds of this levy must not be used for custodial or 
        other maintenance services.  A district may not levy under this 
        subdivision for the purpose of leasing or renting a 
        district-owned building to itself. 
           (c) For agreements finalized after July 1, 1997, a district 
        may not levy under this subdivision for the purpose of leasing:  
        (1) a newly constructed building used primarily for regular 
        kindergarten, elementary, or secondary instruction; or (2) a 
        newly constructed building addition or additions used primarily 
        for regular kindergarten, elementary, or secondary instruction 
        that contains more than 20 percent of the square footage of the 
        previously existing building. 
           (d) The total levy under this subdivision for a district 
        for any year must not exceed $100 times the actual pupil units 
        for the fiscal year to which the levy is attributable. 
           Sec. 20.  Minnesota Statutes 1996, section 124.95, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ELIGIBILITY.] (a) The following portions of a 
        district's debt service levy qualify for debt service 
        equalization: 
           (1) debt service for repayment of principal and interest on 
        bonds issued before July 2, 1992; 
           (2) debt service for bonds refinanced after July 1, 1992, 
        if the bond schedule has been approved by the commissioner and, 
        if necessary, adjusted to reflect a 20-year maturity schedule; 
        and 
           (3) debt service for bonds issued after July 1, 1992, for 
        construction projects that have received a positive review and 
        comment according to section 121.15, if the commissioner has 
        determined that the district has met the criteria under section 
        124.431, subdivision 2, and if the bond schedule has been 
        approved by the commissioner and, if necessary, adjusted to 
        reflect a 20-year maturity schedule.  
           (b) The criterion in section 124.431, subdivision 2, 
        paragraph (a), clause (2), shall be considered to have been met 
        if the district in the fiscal year in which the bonds are 
        authorized at an election conducted under chapter 475: 
           (i) serves an average of at least 66 pupils per grade in 
        the grades to be served by the facility if grades 9 through 12 
        are to be served by the facility, and an average of at least 66 
        pupils per grade in these grades are served; or 
           (ii) is eligible for elementary or secondary sparsity 
        revenue. 
           (c) The criterion in section 124.431, subdivision 2, 
        paragraph (a), clause (2), shall also be considered to have been 
        met if the construction project under review serves students in 
        kindergarten to grade 8.  Only the debt service levy for that 
        portion of the facility serving students in prekindergarten to 
        grade 8, as determined by the commissioner, shall be eligible 
        for debt service equalization under this paragraph. 
           (d) The criterion described in section 124.431, subdivision 
        2, paragraph (a), clause (9), does not apply to bonds authorized 
        by elections held before July 1, 1992. 
           (e) For the purpose of this subdivision the department 
        shall determine the eligibility for sparsity at the location of 
        the new facility, or the site of the new facility closest to the 
        nearest operating school if there is more than one new facility. 
           (f) Notwithstanding paragraphs (a) to (e), debt service for 
        repayment of principal and interest on bonds issued after July 
        1, 1997, does not qualify for debt service equalization aid 
        unless the primary purpose of the facility is to serve students 
        in kindergarten through grade 12. 
           Sec. 21.  Minnesota Statutes 1996, section 124.961, is 
        amended to read: 
           124.961 [DEBT SERVICE APPROPRIATION.] 
           (a) $30,054,000 $35,480,000 in fiscal year 
        1996 1998, $28,162,000 $38,159,000 in fiscal year 1997 1999, 
        and $33,948,000 $38,390,000 in fiscal year 1998 2000 and each 
        year thereafter is appropriated from the general fund to the 
        commissioner of children, families, and learning for payment of 
        debt service equalization aid under section 124.95.  The 1998 
        2000 appropriation includes $4,970,000 $3,842,000 for 1997 
        1999 and $28,978,000 $34,548,000 for 1998 2000. 
           (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. 22.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 10, is amended to read: 
           Subd. 10.  [TOTAL OPERATING CAPITAL REVENUE.] (a) For 
        fiscal year 1997 1999 and thereafter, total operating capital 
        revenue for a district equals the amount determined under 
        paragraph (b), or (c), (d), (e), or (f), plus $68 times the 
        actual pupil units for the school year.  The revenue must be 
        placed in a reserved account in the general fund and may only be 
        used according to subdivision 11. 
           (b) For fiscal years 1996 1999 and later, capital revenue 
        for a district equals $100 times the district's maintenance cost 
        index times its actual pupil units for the school year. 
           (c) For 1996 and later fiscal years, the previous formula 
        revenue for a district equals $128 times its actual pupil units 
        for fiscal year 1995 the school year. 
           (d) Notwithstanding paragraph (b), for fiscal year 1996, 
        the revenue for each district equals 25 percent of the amount 
        determined in paragraph (b) plus 75 percent of the previous 
        formula revenue. 
           (e) Notwithstanding paragraph (b), for fiscal year 1997, 
        the revenue for each district equals 50 percent of the amount 
        determined in paragraph (b) plus 50 percent of the previous 
        formula revenue. 
           (f) Notwithstanding paragraph (b), for fiscal year 1998, 
        the revenue for each district equals 75 percent of the amount 
        determined in paragraph (b) plus 25 percent of the previous 
        formula revenue. 
           (g) For fiscal years 1998 and later, the revenue for a 
        district that operates a program under section 121.585, is 
        increased by an amount equal to $15 $30 times the number of 
        actual pupil units at the site where the program is implemented. 
           Sec. 23.  Minnesota Statutes 1996, section 124A.22, 
        subdivision 11, is amended to read: 
           Subd. 11.  [USES OF TOTAL OPERATING CAPITAL REVENUE.] Total 
        operating capital revenue may be used only for the following 
        purposes: 
           (1) to acquire land for school purposes; 
           (2) to acquire or construct buildings for school purposes, 
        up to $400,000; 
           (3) to rent or lease buildings, including the costs of 
        building repair or improvement that are part of a lease 
        agreement; 
           (4) to improve and repair school sites and buildings, and 
        equip or reequip school buildings with permanent attached 
        fixtures; 
           (5) for a surplus school building that is used 
        substantially for a public nonschool purpose; 
           (6) to eliminate barriers or increase access to school 
        buildings by individuals with a disability; 
           (7) to bring school buildings into compliance with the 
        uniform fire code adopted according to chapter 299F; 
           (8) to remove asbestos from school buildings, encapsulate 
        asbestos, or make asbestos-related repairs; 
           (9) to clean up and dispose of polychlorinated biphenyls 
        found in school buildings; 
           (10) to clean up, remove, dispose of, and make repairs 
        related to storing heating fuel or transportation fuels such as 
        alcohol, gasoline, fuel oil, and special fuel, as defined in 
        section 296.01; 
           (11) for energy audits for school buildings and to modify 
        buildings if the audit indicates the cost of the modification 
        can be recovered within ten years; 
           (12) to improve buildings that are leased according to 
        section 123.36, subdivision 10; 
           (13) to pay special assessments levied against school 
        property but not to pay assessments for service charges; 
           (14) to pay principal and interest on state loans for 
        energy conservation according to section 216C.37 or loans made 
        under the northeast Minnesota economic protection trust fund act 
        according to sections 298.292 to 298.298; 
           (15) to purchase or lease interactive telecommunications 
        equipment; 
           (16) by school board resolution, to transfer money into the 
        debt redemption fund to:  (i) pay the amounts needed to meet, 
        when due, principal and interest payments on certain obligations 
        issued according to chapter 475; or (ii) pay principal and 
        interest on debt service loans or capital loans according to 
        section 124.44; 
           (17) to pay capital expenditure equipment-related 
        assessments of any entity formed under a cooperative agreement 
        between two or more districts; 
           (18) to purchase or lease computers and related materials, 
        copying machines, telecommunications equipment, and other 
        noninstructional equipment; 
           (19) to purchase or lease assistive technology or equipment 
        for instructional programs; 
           (20) to purchase textbooks; 
           (21) to purchase new and replacement library books; 
           (22) to purchase vehicles; 
           (23) to purchase or lease telecommunications equipment, 
        computers, and related equipment for integrated information 
        management systems for: 
           (i) managing and reporting learner outcome information for 
        all students under a results-oriented graduation rule; 
           (ii) managing student assessment, services, and achievement 
        information required for students with individual education 
        plans; and 
           (iii) other classroom information management needs; and 
           (24) to pay personnel costs directly related to the 
        acquisition, operation, and maintenance of telecommunications 
        systems, computers, related equipment, and network and 
        applications software. 
           Sec. 24.  Minnesota Statutes 1996, section 136D.72, 
        subdivision 2, is amended to read: 
           Subd. 2.  [TERMS.] The terms of the members of the first 
        school board shall, as nearly as possible, consist of one-third 
        of the members for one year, one-third of the members for two 
        years, and one-third of the members for three years.  The 
        members of the first board shall determine by lot which length 
        of term each member of the first board shall be assigned.  Terms 
        of office of the members of the board shall expire on June 30 
        January 1.  Thereafter the terms of office of board members 
        shall be for three four years commencing on July 1 January 1 of 
        each year.  If a vacancy occurs on the board, it shall be filled 
        by the appropriate school board.  A person appointed to the 
        board shall qualify as a board member by filing with the chief 
        executive officer thereof a written certificate of appointment 
        from the appointing school board.  
           Sec. 25.  Minnesota Statutes 1996, section 136D.72, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ANNUAL ORGANIZATIONAL MEETING.] The first 
        meeting of the first school board shall be at such time mutually 
        agreed to by the members appointed by the participating school 
        districts.  Thereafter The school board shall meet in July 
        January of each year when notified of such meeting by the chief 
        executive officer of the intermediate school district.  At such 
        first the organizational meeting, the officers of the 
        intermediate school district for the current year shall be 
        chosen and such other organizational business as may be 
        necessary shall be conducted. 
           Sec. 26.  [DUTIES OF THE DEPARTMENT OF CHILDREN, FAMILIES, 
        AND LEARNING.] 
           Subdivision 1.  [DUTIES.] (a) The department of children, 
        families, and learning, in collaboration with the departments of 
        health and administration, school districts, and other public 
        and private agencies, must develop the following: 
           (1) an indoor air quality maintenance manual; 
           (2) a planning and construction manual to assure indoor air 
        quality; and 
           (3) a public information plan for students, parents, staff, 
        and other members of the public. 
           (b) The above manuals and plans shall include: 
           (1) process standards for school districts and the 
        department of children, families, and learning to follow when 
        addressing indoor air quality concerns; 
           (2) informational materials for a model school district 
        indoor air quality program; 
           (3) training needs for school district employees; 
           (4) procedures for school districts when disseminating 
        indoor air quality information and test results to parents, 
        teachers, and other persons; 
           (5) indoor air quality considerations under the review and 
        comment process for school buildings, specific evaluations of 
        proposed construction standards and materials, to be included in 
        the review and comment standards; 
           (6) building systems maintenance and housekeeping practices 
        required to assure adequate indoor air quality; 
           (7) architectural, engineering, maintenance engineering, 
        and other design practices to positively affect indoor air 
        quality; 
           (8) regional and state resources available to assist 
        districts with information and training needs of school staff, 
        parents, and community; 
           (9) regional and state resources available to assist 
        districts with medical evaluation relative to indoor air quality 
        complaints; and 
           (10) recommended steps a district should take to attain a 
        satisfactory level of indoor air quality. 
           Subd. 2.  [RESOURCE MANUAL; REPORT.] The indoor air quality 
        resource manual must be made available for distribution and 
        training February 1, 1998, and a report regarding the status of 
        indoor air quality in Minnesota schools will be made to the 1998 
        legislature. 
           Sec. 27.  [TRANSITION.] 
           As a result of section 24, the terms of office of members 
        and officers of the board shall be lengthened to expire on the 
        January 1 following the June 30 on which they otherwise would 
        have expired. 
           Sec. 28.  [REVENUE USE APPROVAL.] 
           The use of revenue for construction in independent school 
        district No. 561, Goodridge, authorized in Laws 1995, First 
        Special Session chapter 3, article 8, section 23, and in 
        independent school district No. 600, Fisher, authorized in Laws 
        1995, First Special Session chapter 3, article 8, section 22, 
        subdivision 21, is approved.  The department shall not make any 
        levy or aid adjustments related to these projects.  
           Sec. 29.  [CHISAGO LAKES AREA SCHOOLS, BONDED DEBT.] 
           Independent school district No. 2144, Chisago Lakes Area, 
        may modify its plan adopted according to Minnesota Statutes, 
        section 122.242, subdivision 9, clause (1), so that independent 
        school district No. 2144 assumes all of the remaining debt 
        service as of the effective date of this section for bonds that 
        were outstanding at the time of the combination of independent 
        school districts No. 141, Chisago Lakes and No. 140, Taylors 
        Falls, and the tax levy for that debt service is spread on all 
        the property in independent school district No. 2144, Chisago 
        Lakes Area. 
           Sec. 30.  [LEASE LEVY; NORTH ST. PAUL-MAPLEWOOD.] 
           Notwithstanding Minnesota Statutes, section 124.91, 
        subdivision 1, independent school district No. 622, North St. 
        Paul-Maplewood, annually may levy the amount necessary to pay 
        its obligations under a lease or a lease with option to purchase 
        agreement during the term of that agreement for the financing of 
        capital improvements approved by its school board to the 
        building, or any portion thereof, at 2520 East Twelfth Avenue, 
        North St. Paul.  The total payments under the terms of the lease 
        may not exceed $4,000,000.  The agreement must be executed by 
        July 1, 1998, and may include a sale and leaseback with option 
        to purchase with a public or private entity.  The agreement is 
        not required to include a nonappropriation clause.  An election 
        is not required in connection with the execution of the 
        agreement and the obligation created by the agreement does not 
        constitute debt and must not be included in the calculation of 
        net debt for the district.  Levies under this section do not 
        qualify for debt service equalization aid. 
           Sec. 31.  [LEVY FOR EXTENDED SCHOOL HOURS AND DAYS.] 
           In addition to other levies, independent school district 
        Nos. 622, North St. Paul-Maplewood-Oakdale; 833, South 
        Washington County; and 834, Stillwater may each levy up to 
        $200,000 each year for the costs of operating extended year, 
        extended day, or all day kindergarten programs at the joint 
        elementary facility authorized in Laws 1995, First Special 
        Session chapter 3, article 5, section 19. 
           Sec. 32.  [SPECIAL EDUCATION AND SECONDARY VOCATIONAL 
        FACILITIES.] 
           The commissioner shall review and report on the quality, 
        availability, and accessibility of intermediate school district 
        special education and secondary vocational facilities and shall 
        make recommendations to the legislature concerning alternatives 
        that are cost-effective and in the best interests of the 
        students in such programs. 
           Sec. 33.  [1996-1997 AVERAGE DAILY MEMBERSHIP.] 
           Notwithstanding Minnesota Statutes, section 124.17, the 
        1996-1997 average daily membership for a school building closed 
        due to flooding for part of the school year and reopened before 
        the end of the school year shall be the greater of the amount 
        that would have been computed if the school building had not 
        reopened or the amount computed using actual data for the entire 
        school year. 
           Sec. 34.  [FISCAL YEAR 1998 DECLINING PUPIL UNIT AID.] 
           For fiscal year 1998 only, a school district with one or 
        more school buildings closed during the 1996-1997 school year 
        due to flooding is eligible for declining pupil unit aid equal 
        to the greater of zero or the product of the general education 
        formula allowance for fiscal year 1998 times the difference 
        between the district's actual pupil units for the 1996-1997 
        school year and the district's actual pupil units for the 
        1997-1998 school year. 
           Sec. 35.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated.  
           Subd. 2.  [SPECIAL CONSOLIDATION AID.] For special 
        consolidation aid under Minnesota Statutes, section 124.2728: 
             $3,000     .....     1998
           The 1998 appropriation includes $3,000 for 1997 and $0 for 
        1998. 
           Subd. 3.  [CONSOLIDATION TRANSITION AID.] For districts 
        consolidating under Minnesota Statutes, section 124.2726: 
             $1,254,000     .....     1998
             $1,151,000     .....     1999
           The 1998 appropriation includes $67,000 for 1997 and 
        $1,187,000 for 1998. 
           The 1999 appropriation includes $131,000 for 1998 and 
        $1,020,000 for 1999. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 4.  [COOPERATION AND COMBINATION AID.] For aid for 
        districts that cooperate and combine according to Minnesota 
        Statutes, section 124.2725: 
             $562,000     .....     1998 
             $ 42,000     .....     1999 
           The 1998 appropriation includes $178,000 for 1997 and 
        $384,000 for 1998.  
           The 1999 appropriation includes $42,000 for 1998 and $0 for 
        1999.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 5.  [DISTRICT COOPERATION REVENUE.] For district 
        cooperation revenue aid: 
             $9,766,000     .....     1998
             $8,780,000     .....     1999
           The 1998 appropriation includes $1,172,000 for 1997 and 
        $8,561,000 for 1998. 
           The 1999 appropriation includes $951,000 for 1998 and 
        $7,829,000 for 1999. 
           Subd. 6.  [HISTORIC BUILDING AID.] For historic building 
        aid under section 124.825: 
             $173,000     .....     1998 
             $173,000     .....     1999 
           Subd. 7.  [HIBBING GRANT.] For a grant to independent 
        school district No. 701, Hibbing, for expenses not covered by 
        insurance for a fire loss at Hibbing high school: 
             $250,000     .....     1998 
           Independent school district No. 701, Hibbing, shall 
        reimburse the state general fund for any expenses covered by 
        this appropriation that are recovered as a result of a lawsuit 
        related to the fire loss at Hibbing high school. 
           Subd. 8.  [PLANNING GRANT; ISLE.] For a facilities planning 
        grant to independent school district No. 473, Isle:  
             $100,000     .....     1998  
           This appropriation is available until June 30, 1999. 
           Subd. 9.  [FLOOD LOSSES.] For grants and loans to 
        independent school district Nos. 2854, Ada-Borup; 2176, 
        Warren-Alvarado-Oslo; 846, Breckenridge; 595, East Grand Forks; 
        and other districts affected by the 1997 floods for expenses 
        associated with the floods not covered by insurance or state or 
        federal disaster relief: 
           $4,700,000     .....     1998
           The commissioner shall award grants and loans to school 
        districts to cover expenses associated with the 1997 floods.  
        The grants or loans may be for capital losses or for 
        extraordinary operating expenses resulting from the floods.  
        School districts shall repay any loan or grant amounts to the 
        department if those amounts are otherwise funded from other 
        sources.  The commissioner shall establish the terms and 
        conditions of any loans and may request any necessary 
        information from school districts before awarding a grant or 
        loan.  This appropriation shall also be used to fund aid under 
        sections 33 and 34. 
           Sec. 36.  [REPEALER.] 
           Minnesota Statutes 1996, section 124.2728, is repealed 
        effective for revenue for fiscal year 1999. 
           Sec. 37.  [EFFECTIVE DATE.] 
           (a) Section 20 is effective for bonds outstanding on July 
        1, 1997, that meet the criteria in section 20 and is effective 
        for revenue for fiscal year 1999.  
           (b) Section 29 is effective the day following compliance by 
        the school board of independent school district No. 2144, 
        Chisago Lakes Area, with Minnesota Statutes, section 645.021, 
        and contingent upon successful passage of new bond issue under 
        Minnesota Statutes, section 475.58.  
           (c) Section 22 is effective for revenue for fiscal year 
        1999, except that the allowance increase in section 22 is 
        effective for revenue for fiscal year 1998, and the change in 
        previous formula revenue under paragraph (c) is effective 
        immediately. 
           (d) If this act is enacted on or after July 1, 1997, all 
        sections in this article except those sections listed in 
        paragraphs (a) to (c) are effective the day following final 
        enactment. 
                                   ARTICLE 5
                              EDUCATION EXCELLENCE
           Section 1.  Minnesota Statutes 1996, section 120.062, 
        subdivision 3, is amended to read: 
           Subd. 3.  [CLOSED DISTRICTS LIMITED ENROLLMENT OF 
        NONRESIDENT PUPILS.] (a) A school board may, by 
        resolution, determine that limit the enrollment of nonresident 
        pupils may not attend any of in its schools or programs 
        according to this section. to a number not less than the lesser 
        of: 
           (1) one percent of the total enrollment at each grade level 
        in the district; or 
           (2) the number of district residents at that grade level 
        enrolled in a nonresident district according to this section.  
           (b) A district that limits enrollment of nonresident pupils 
        under paragraph (a) shall report to the commissioner by July 15 
        on the number of nonresident pupils denied admission due to the 
        limitations on the enrollment of nonresident pupils. 
           Sec. 2.  Minnesota Statutes 1996, section 120.062, 
        subdivision 6, is amended to read: 
           Subd. 6.  [NONRESIDENT DISTRICT PROCEDURES.] A district 
        that does not exclude nonresident pupils, according to 
        subdivision 3, shall notify the parent or guardian in writing by 
        February 15 whether the application has been accepted or 
        rejected.  If an application is rejected, the district must 
        state in the notification the reason for rejection.  The parent 
        or guardian shall notify the nonresident district by March 1 
        whether the pupil intends to enroll in the nonresident 
        district.  Notice of intent to enroll in the nonresident 
        district obligates the pupil to attend the nonresident district 
        during the following school year, unless the school boards of 
        the resident and the nonresident districts agree in writing to 
        allow the pupil to transfer back to the resident district, or 
        the pupil's parents or guardians change residence to another 
        district.  If a parent or guardian does not notify the 
        nonresident district, the pupil may not enroll in that 
        nonresident district during the following school year, unless 
        the school boards of the resident and nonresident district agree 
        otherwise.  The nonresident district shall notify the resident 
        district by March 15 of the pupil's intent to enroll in the 
        nonresident district.  The same procedures apply to a pupil who 
        applies to transfer from one participating nonresident district 
        to another participating nonresident district. 
           Sec. 3.  Minnesota Statutes 1996, section 120.062, 
        subdivision 7, is amended to read: 
           Subd. 7.  [BASIS FOR DECISIONS.] The school board must 
        adopt, by resolution, specific standards for acceptance and 
        rejection of applications.  Standards may include the capacity 
        of a program, class, grade level, or school building.  The 
        school board may not reject applications for enrollment in a 
        particular grade level if the nonresident enrollment at that 
        grade level does not exceed the limit set by the board under 
        subdivision 3.  Standards may not include previous academic 
        achievement, athletic or other extracurricular ability, 
        disabling conditions, proficiency in the English language, or 
        previous disciplinary proceedings, or the student's district of 
        residence.  
           Sec. 4.  Minnesota Statutes 1996, section 120.062, 
        subdivision 11, is amended to read: 
           Subd. 11.  [INFORMATION.] A district that does not exclude 
        nonresident pupils according to subdivision 3 shall make 
        information about the district, schools, programs, policies, and 
        procedures available to all interested people.  
           Sec. 5.  Minnesota Statutes 1996, section 120.064, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SPONSOR.] A school board, private college, 
        community college, state university, technical college, or the 
        University of Minnesota may sponsor one or more charter schools. 
           No more than a total of 40 charter schools may be 
        authorized not more than three of which may be sponsored by 
        public post-secondary institutions.  The state board of 
        education shall advise potential sponsors when the maximum 
        number of charter schools has been authorized. 
           Sec. 6.  Minnesota Statutes 1996, section 120.064, 
        subdivision 8, is amended to read: 
           Subd. 8.  [REQUIREMENTS.] (a) A charter school shall meet 
        all applicable state and local health and safety requirements. 
           (b) The A school must sponsored by a school board may be 
        located in the sponsoring any district, unless another the 
        school board agrees to locate a charter school sponsored by 
        another district in its boundaries of the district of the 
        proposed location disapproves by written resolution.  If such a 
        school board denies a request to locate within its boundaries a 
        charter school sponsored by another district school board, the 
        sponsoring district school board may appeal to the state board 
        of education.  If the state board authorizes the school, the 
        state board shall sponsor the school.  
           (c) A charter school must be nonsectarian in its programs, 
        admission policies, employment practices, and all other 
        operations.  A sponsor may not authorize a charter school or 
        program that is affiliated with a nonpublic sectarian school or 
        a religious institution. 
           (d) Charter schools shall not be used as a method of 
        providing education or generating revenue for students who are 
        being home-schooled. 
           (e) The primary focus of a charter school must be to 
        provide a comprehensive program of instruction for at least one 
        grade or age group from five through 18 years of age.  
        Instruction may be provided to people younger than five years 
        and older than 18 years of age. 
           (f) A charter school may not charge tuition. 
           (g) A charter school is subject to and shall comply with 
        chapter 363 and section 126.21. 
           (h) A charter school is subject to and shall comply with 
        the pupil fair dismissal act, sections 127.26 to 127.39, and the 
        Minnesota public school fee law, sections 120.71 to 120.76. 
           (i) A charter school is subject to the same financial 
        audits, audit procedures, and audit requirements as a school 
        district.  The audit must be consistent with the requirements of 
        sections 121.904 to 121.917, except to the extent deviations are 
        necessary because of the program at the school.  The department 
        of children, families, and learning, state auditor, or 
        legislative auditor may conduct financial, program, or 
        compliance audits. 
           (j) A charter school is a school district for the purposes 
        of tort liability under chapter 466. 
           Sec. 7.  Minnesota Statutes 1996, section 120.064, 
        subdivision 10, is amended to read: 
           Subd. 10.  [PUPIL PERFORMANCE.] A charter school must 
        design its programs to at least meet the outcomes adopted by the 
        state board of education for public school students.  In the 
        absence of state board requirements, the school must meet the 
        outcomes contained in the contract with the sponsor.  The 
        achievement levels of the outcomes contained in the contract may 
        exceed the achievement levels of any outcomes adopted by the 
        state board for public school students. 
           Sec. 8.  Minnesota Statutes 1996, section 120.064, is 
        amended by adding a subdivision to read: 
           Subd. 14a.  [REVIEW AND COMMENT.] The department shall 
        review and comment on the evaluation, by the chartering school 
        district, of the performance of a charter school before the 
        charter school's contract is renewed.  The information from the 
        review and comment shall be reported to the state board of 
        education in a timely manner.  Periodically, the state board 
        shall report trends or suggestions based on the evaluation of 
        charter school contracts to the education committees of the 
        state legislature. 
           Sec. 9.  Minnesota Statutes 1996, section 120.064, 
        subdivision 20a, is amended to read: 
           Subd. 20a.  [TEACHERS TEACHER AND OTHER EMPLOYEE 
        RETIREMENT.] (a) Teachers in a charter school shall be public 
        school teachers for the purposes of chapters 354 and 354a. 
           (b) Except for teachers under paragraph (a), employees in a 
        charter school shall be public employees for the purposes of 
        chapter 353. 
           Sec. 10.  Minnesota Statutes 1996, section 121.611, is 
        amended to read: 
           121.611 [NONLICENSED COMMUNITY EXPERTS; VARIANCE.] 
           Subdivision 1.  [AUTHORIZATION.] Notwithstanding any law or 
        state board of education rule to the contrary, the board of 
        teaching may allow school districts or charter schools to hire 
        nonlicensed community experts to teach in the public schools or 
        charter schools on a limited basis according to this section. 
           Subd. 2.  [APPLICATIONS; CRITERIA.] The school district or 
        charter school shall apply to the board of teaching for approval 
        to hire nonlicensed teaching personnel from the community.  In 
        approving or disapproving the district's application for each 
        community expert, the board shall consider: 
           (1) the qualifications of the community person whom the 
        district or charter school proposes to employ; 
           (2) the reasons for the district's need for a variance from 
        the teacher licensure requirements; 
           (3) the district's efforts to obtain licensed teachers, who 
        are acceptable to the school board, for the particular course or 
        subject area or the charter school's efforts to obtain licensed 
        teachers for the particular course or subject area; 
           (4) the amount of teaching time for which the community 
        expert would be hired; 
           (5) the extent to which the district or charter school is 
        utilizing other nonlicensed community experts under this 
        section; 
           (6) the nature of the community expert's proposed teaching 
        responsibility; and 
           (7) the proposed level of compensation to the community 
        expert. 
           Subd. 3.  [APPROVAL OF PLAN.] The board of teaching shall 
        approve or disapprove an application within 60 days of receiving 
        it from a school district or charter school. 
           Sec. 11.  Minnesota Statutes 1996, section 123.951, is 
        amended to read: 
           123.951 [SCHOOL SITE DECISION-MAKING AGREEMENT.] 
           Subdivision 1.  [DEFINITION.] "Education site" means a 
        separate facility.  A program within a facility is an education 
        site if the school board recognizes it as a site.  
           Subd. 2.  [AGREEMENT.] (a) A Either the school board or the 
        school site decision-making team may request that the school 
        board may enter into an agreement with a school site 
        decision-making team concerning the governance, management, or 
        control of any the school in the district.  Upon a written 
        request from a proposed school site decision-making team, An 
        initial A school site decision-making team shall be appointed by 
        the school board and may include the school 
        principal, representatives of teachers in the school or their 
        designee, representatives of other employees in the 
        school, representatives of parents of pupils in the school, 
        representatives of pupils in the school, representatives of or 
        other members in the community, or others determined appropriate 
        by the board.  The school site decision-making team shall 
        include the school principal or other person having general 
        control and supervision of the school.  The site decision-making 
        team must reflect the diversity of the education site.  No more 
        than one-half of the members shall be employees of the district. 
           (b) School site decision-making agreements must delegate 
        powers and, duties, and broad management responsibilities to 
        site teams and involve staff members, students as appropriate, 
        and parents in decision making. 
           (c) An agreement shall include a statement of powers, 
        duties, responsibilities, and authority to be delegated to and 
        within the site. 
           (d) An agreement may include: 
           (1) a mechanism to implement flexible support systems for 
        improvement in student achievement of education outcomes an 
        achievement contract according to subdivision 4; 
           (2) a decision-making structure that allows teachers to 
        identify instructional problems and control and apply the 
        resources needed to solve them; 
           (3) a mechanism to allow principals, or other persons 
        having general control and supervision of the school, to make 
        decisions regarding how financial and personnel resources are 
        best allocated at the site and from whom goods or services are 
        purchased; 
           (4) (3) a mechanism to implement parental involvement 
        programs under section 126.69 and to provide for effective 
        parental communication and feedback on this involvement at the 
        site level; 
           (5) (4) a provision that would allow the team to determine 
        who is hired into licensed and nonlicensed positions; 
           (6) (5) a provision that would allow teachers to choose the 
        principal or other person having general control; 
           (7) direct contact with other social service providers; 
           (8) in-service training for site decision-making team 
        members for financial management of school sites; and 
           (9) (6) an amount of revenue allocated to the site under 
        subdivision 3; and 
           (7) any other powers and duties determined appropriate by 
        the board. 
           The school board of the district remains the legal employer 
        under clauses (5) (4) and (6) (5). 
           (d) (e) Any powers or duties not delegated to the school 
        site management team in the school site management agreement 
        shall remain with the school board. 
           (e) (f) Approved agreements shall be filed with the 
        commissioner.  If a school board denies a request to enter into 
        a school site management agreement, it shall provide a copy of 
        the request and the reasons for its denial to the commissioner.  
           Subd. 3.  [REVENUE AND COST ALLOCATION.] Revenue for a 
        fiscal year received or receivable by the district shall be 
        allocated to education sites based on the agreement between the 
        school board and the site decision-making team.  Revenue shall 
        remain allocated to each site until used by the site.  The site 
        teams and the board may enter an agreement that permits the 
        district to provide services and retain the revenue required to 
        pay for the services provided.  The district remains responsible 
        for legally entering into contracts and expending funds.  For 
        the purposes of this subdivision, "allocation" means that the 
        determination of the use of the revenue shall be under the 
        control of the site.  The district may charge the accounts of 
        each site the actual costs of goods and services from the 
        general or capital funds attributable to the site. 
           Subd. 4.  [ACHIEVEMENT CONTRACT.] A school board may enter 
        a written education site achievement contract with each site 
        decision-making team for the purpose of setting learning 
        performance expectations for that site, including the goals for 
        improvement in each area of student performance during the next 
        year, a plan to assist the education site if their goals are not 
        achieved, and other performance expectations and measures 
        determined by the board and the site decision-making team. 
           Subd. 5.  [COMMISSIONER'S ROLE.] The commissioner of 
        children, families, and learning, in consultation with 
        appropriate educational organizations, shall: 
           (1) upon request, provide technical support for districts 
        and sites with agreements under this section; 
           (2) conduct and compile research on the effectiveness of 
        site decision making; and 
           (3) periodically report on and evaluate the effectiveness 
        of site management agreements on a statewide basis. 
           Sec. 12.  Minnesota Statutes 1996, section 123.972, 
        subdivision 5, is amended to read: 
           Subd. 5.  [REPORT.] (a) By October 1 of each year, the 
        school board shall use standard statewide reporting procedures 
        the commissioner develops and adopt a report that includes the 
        following: 
           (1) student performance goals for meeting state graduation 
        standards adopted for that year; 
           (2) results of local assessment data, and any additional 
        test data; 
           (3) the annual school district improvement plans; and 
           (4) information about district and learning site progress 
        in realizing previously adopted improvement plans; and 
           (5) the amount and type of revenue attributed to each 
        education site as defined in section 123.951, subdivision 2. 
           (b) The school board shall publish the report in the local 
        newspaper with the largest circulation in the district or by 
        mail.  The board shall make a copy of the report available to 
        the public for inspection.  The board shall send a copy of the 
        report to the commissioner of children, families, and learning 
        by October 15 of each year. 
           (c) The title of the report shall contain the name and 
        number of the school district and read "Annual Report on 
        Curriculum, Instruction, and Student Performance."  The report 
        must include at least the following information about advisory 
        committee membership: 
           (1) the name of each committee member and the date when 
        that member's term expires; 
           (2) the method and criteria the school board uses to select 
        committee members; and 
           (3) the date by which a community resident must apply to 
        next serve on the committee. 
           Sec. 13.  Minnesota Statutes 1996, section 124.248, is 
        amended by adding a subdivision to read: 
           Subd. 2a.  [BUILDING LEASE AID.] When a charter school 
        finds it economically advantageous to rent or lease a building 
        or land for any instructional purposes and it determines that 
        the total operating capital revenue under section 124A.22, 
        subdivision 10, is insufficient for this purpose, it may apply 
        to the commissioner for building lease aid for this purpose.  
        Criteria for aid approval and revenue uses shall be as defined 
        for the building lease levy in section 124.91, subdivision 1.  
        The amount of building lease aid per pupil unit for a charter 
        school for any year shall not exceed the lesser of (a) 80 
        percent of the approved cost or (b) the product of the actual 
        pupil units for the current school year times the sum of the 
        state average debt redemption fund revenue plus capital revenue, 
        according to section 124.91, per actual pupil unit for the 
        current fiscal year. 
           Sec. 14.  Minnesota Statutes 1996, section 124.248, 
        subdivision 4, is amended to read: 
           Subd. 4.  [OTHER AID, GRANTS, REVENUE.] (a) A charter 
        school is eligible to receive other aids, grants, and revenue 
        according to chapters 120 to 129, as though it were a school 
        district except that, notwithstanding section 124.195, 
        subdivision 3, the payments shall be of an equal amount on each 
        of the 23 payment dates unless a charter school is in its first 
        year of operation in which case it shall receive on its first 
        payment date 15 10 percent of its cumulative amount guaranteed 
        for the year and 22 payments of an equal amount thereafter the 
        sum of which shall be 85 90 percent of the cumulative amount 
        guaranteed.  However, it may not receive aid, a grant, or 
        revenue if a levy is required to obtain the money, except as 
        otherwise provided in this section.  Federal aid received by the 
        state must be paid to the school, if it qualifies for the aid as 
        though it were a school district. 
           (b) Any revenue received from any source, other than 
        revenue that is specifically allowed for operational, 
        maintenance, capital facilities revenue under paragraph (c), and 
        capital expenditure equipment costs under this section, may be 
        used only for the planning and operational start-up costs of a 
        charter school.  Any unexpended revenue from any source under 
        this paragraph must be returned to that revenue source or 
        conveyed to the sponsoring school district, at the discretion of 
        the revenue source. 
           (c) A charter school may receive money from any source for 
        capital facilities needs.  Any unexpended capital facilities 
        revenue must be reserved and shall be expended only for future 
        capital facilities purposes.  In the year-end report to the 
        state board of education, the charter school shall report the 
        total amount of funds received from grants and other outside 
        sources. 
           Sec. 15.  Minnesota Statutes 1996, section 124.248, is 
        amended by adding a subdivision to read: 
           Subd. 6.  [START-UP COSTS.] During the first two years of a 
        charter school's operation, the charter school is eligible for 
        aid to pay for start-up costs and additional operating costs.  
        Start-up cost aid equals the greater of: 
           (1) $50,000 per charter school; or 
           (2) $500 times the charter school's pupil units for that 
        year. 
           Sec. 16.  Minnesota Statutes 1996, section 125.05, 
        subdivision 1c, is amended to read: 
           Subd. 1c.  [SUPERVISORY AND COACH QUALIFICATIONS; CODE OF 
        ETHICS.] The state board of education shall issue licenses under 
        its jurisdiction to persons the state board finds to be 
        qualified and competent for their respective positions under the 
        rules it adopts.  The state board of education may develop, by 
        rule, a code of ethics for supervisory personnel covering 
        standards of professional practices, including areas of ethical 
        conduct and professional performance and methods of enforcement. 
           Sec. 17.  Minnesota Statutes 1996, section 125.05, 
        subdivision 2, is amended to read: 
           Subd. 2.  [EXPIRATION AND RENEWAL.] (a) Each license issued 
        the department of children, families, and learning issues 
        through the its licensing section of the department of children, 
        families, and learning must bear the date of issue.  Licenses 
        must expire and be renewed in accordance with according to the 
        respective rules adopted by the board of teaching or the state 
        board of education adopts.  Requirements for renewal of renewing 
        a license must include production of showing satisfactory 
        evidence of successful teaching experience for at least one 
        school year during the period covered by the license in grades 
        or subjects for which the license is valid or completion of 
        completing such additional preparation as the board of 
        teaching shall prescribe prescribes.  The state board of 
        education shall establish requirements for renewal of renewing 
        the licenses of supervisory personnel must be established by the 
        state board of education.  
           (b) The board of teaching shall offer alternative 
        continuing relicensure options for teachers who are accepted 
        into and complete the national board for professional teaching 
        standards certification process, and offer additional continuing 
        relicensure options for teachers who earn national board for 
        professional teaching standards certification.  Continuing 
        relicensure requirements for teachers who do not maintain 
        national board for professional teaching standards certification 
        are those the board prescribes.  
           Sec. 18.  Minnesota Statutes 1996, section 126.22, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ELIGIBLE PROGRAMS.] (a) A pupil who is eligible 
        according to subdivision 2 may enroll in area learning centers 
        under sections 124C.45 to 124C.48, or according to section 
        121.11, subdivision 12. 
           (b) A pupil who is eligible according to subdivision 2 and 
        who is between the ages of 16 and 21 may enroll in 
        post-secondary courses under section 123.3514. 
           (c) A pupil who is eligible under subdivision 2, may enroll 
        in any public elementary or secondary education program.  
        However, a person who is eligible according to subdivision 2, 
        clause (b), may enroll only if the school board has adopted a 
        resolution approving the enrollment. 
           (d) A pupil who is eligible under subdivision 2, may enroll 
        in any nonprofit, nonpublic, nonsectarian school that has 
        contracted with the serving school district to provide 
        educational services. 
           (e) A pupil who is between the ages of 16 and 21 may enroll 
        in any adult basic education programs approved under section 
        124.26 and operated under the community education program 
        contained in section 121.88. 
           Sec. 19.  Minnesota Statutes 1996, section 126.22, 
        subdivision 3a, is amended to read: 
           Subd. 3a.  [ADDITIONAL ELIGIBLE PROGRAM.] A pupil who is at 
        least 16 years of age, who is eligible under subdivision 2, 
        clause (a), and who has been enrolled only in a public school, 
        if the pupil has been enrolled in any school, during the year 
        immediately before transferring under this subdivision, may 
        transfer to any nonprofit, nonpublic school that has contracted 
        with the serving school district to provide nonsectarian 
        educational services.  Such a school must enroll every eligible 
        pupil who seeks to transfer to the school under this program 
        subject to available space. 
           Sec. 20.  Laws 1995, First Special Session chapter 3, 
        article 11, section 21, subdivision 3, is amended to read: 
           Subd. 3.  [CHARTER SCHOOL EVALUATION.] For the state board 
        of education to evaluate the performance of charter schools 
        authorized according to Minnesota Statutes, section 120.064: 
             $75,000     .....     1996 
           The state board must review and comment on the evaluation, 
        by the chartering school district, of the performance of a 
        charter school before that charter school's contract is 
        renewed.  The state board may provide assistance to a school 
        district in evaluating a charter school that has been chartered 
        by that school board.  The board must report annually to the 
        education committees of the legislature on the results of its 
        evaluations.  This amount is available until June 30, 1997. 
           Sec. 21.  Laws 1996, chapter 412, article 4, section 34, 
        subdivision 4, is amended to read: 
           Subd. 4.  [COMMUNITY-BASED CHARTER SCHOOL GRANT.] For a 
        grant for community-based charter ?schools involving the 
        participation of an operating foundation, the city and county, 
        and St. Paul public schools located in independent school 
        district No. 625, St. Paul: 
             $300,000     .....     1997 
           The commissioner may establish criteria and any reporting 
        or match requirements for the grant under this section. 
           Sec. 22.  [GRANT PROGRAM TO PROMOTE PROFESSIONAL TEACHING 
        STANDARDS.] 
           Subdivision 1.  [ESTABLISHMENT.] A grant program to promote 
        professional teaching standards through the national board for 
        professional teaching standards for fiscal year 1998 is 
        established to provide eligible teachers with the opportunity to 
        receive national board for professional teaching standards 
        certification and to reward teachers who have already received 
        such certification. 
           Subd. 2.  [ELIGIBILITY.] An applicant for a grant must be a 
        licensed K-12 school teacher employed in a state school.  To be 
        eligible for a grant, the teacher must have been employed as a 
        teacher for a minimum of five school years and demonstrate 
        either that the national board for professional teaching 
        standards has accepted the teacher as a candidate for board 
        certification or that the teacher already has received board 
        certification. 
           Subd. 3.  [APPLICATION PROCESS.] To obtain a grant to 
        participate in the national board for professional teaching 
        standards certification process or to receive a reward for 
        already completing the board certification process, a teacher 
        must submit an application to the commissioner of children, 
        families, and learning in the form and manner the commissioner 
        establishes.  The applicant must demonstrate either that the 
        national board for professional teaching standards has accepted 
        the teacher as a candidate for board certification or that the 
        teacher already has received board certification.  The 
        commissioner shall consult with the state board of teaching when 
        reviewing the applications. 
           Subd. 4.  [GRANT AWARDS; PROCEEDS.] (a) The commissioner 
        may award matching grants of $1,000 each to eligible teachers 
        who provide a matching amount through collaboration with either 
        a school district, professional organization, or both and are 
        accepted as candidates for national board for professional 
        teaching standards certification.  Grant recipients shall use 
        the grant to participate in the certification process.  Within 
        24 months of receiving certification, a grant recipient must 
        satisfactorily complete one year of teaching service in a state 
        school or repay the state the amount of the grant, except if the 
        commissioner determines that death or disability prevents the 
        grant recipient from providing the one year of teaching service. 
           (b) The commissioner may award grants to eligible teachers 
        who have earned national board for professional teaching 
        standards certification.  The amount of each grant shall not 
        exceed $1,000 and the commissioner shall establish criteria to 
        determine the actual amount of each grant.  Grant recipients 
        shall use the grant proceeds for educational purposes, including 
        purchasing instructional materials, equipment, or supplies and 
        realizing professional development opportunities.  
           Sec. 23.  [LABORATORY SCHOOL GRANTS.] 
           Subdivision 1.  [ESTABLISHMENT.] The commissioner of 
        children, families, and learning shall make grants to 
        post-secondary institutions to establish laboratory schools that 
        cooperate with interested school districts to develop innovative 
        teaching techniques that enhance students' learning 
        experiences.  A laboratory school must be nonsectarian in its 
        programs, admissions policies, employment practices, and all 
        other operations.  
           Subd. 2.  [GRANT APPLICATION.] A public or private 
        post-secondary institution located in the state may submit an 
        application for a grant.  Each grant application must include: 
           (1) the location of the laboratory school determined in 
        collaboration with a school district, or proposed as a charter 
        school; 
           (2) a five-year fiscal plan demonstrating that the school 
        shall operate with no additional state revenue except revenue 
        received under Minnesota Statutes, chapters 124 and 124A, and 
        the grant money awarded under this section; and 
           (3) for an applicant seeking a grant to improve lifework 
        learning, a description of how the applicant will use 
        information technologies and participate in partnerships with 
        kindergarten through grade 12 schools and post-secondary 
        institutions, business and industry, labor, agriculture, 
        government, and community-based organizations. 
           The commissioner of children, families, and learning, in 
        consultation with interested post-secondary institutions, shall 
        establish guidelines and an application process for the grants.  
        In awarding a grant, the commissioner shall give priority to an 
        eligible applicant that meets the criteria in clause (3). 
           Subd. 3.  [GRANT MONEY.] The grant money may be used for: 
           (1) technology; 
           (2) equipment; 
           (3) teacher mentorships; 
           (4) building remodeling, renovation, or repair; 
           (5) disseminating innovative and effective teaching 
        techniques; 
           (6) education research to develop teaching methods, 
        assessments, and curriculum design; 
           (7) developing creative opportunities for parental 
        involvement; 
           (8) furthering school integration efforts; and 
           (9) other inventive teaching and learning practices 
        designed to implement the high school graduation standards under 
        Minnesota Statutes, section 121.11, subdivision 7c.  
           Sec. 24.  [GIFTED AND TALENTED GRANTS.] 
           Subdivision 1.  [ESTABLISHMENT.] Gifted and talented grants 
        are established to provide access to an appropriate program for 
        students identified as gifted or talented.  A school district or 
        any group of school districts must use the grants to establish a 
        process for identifying gifted and talented students, offer 
        access to challenging learning experiences for students in 
        kindergarten through grade 12, and provide for staff development 
        in meeting the learning needs of gifted and talented students. 
           Subd. 2.  [ELIGIBILITY; CRITERIA.] An applicant for a 
        gifted and talented grant must be a school district or any group 
        of school districts.  The commissioner of children, families, 
        and learning, a representative of the alliance of the Minnesota 
        educators of the gifted and talented, a representative of the 
        Minnesota council of the gifted and talented, and a 
        representative of the challenge task force shall establish the 
        criteria for awarding grants for appropriate programs. 
           Subd. 3.  [APPLICATION.] A school district or any group of 
        school districts must submit an application to the commissioner 
        of children, families, and learning in the form and manner the 
        commissioner establishes. 
           Subd. 4.  [GRANT AWARDS.] A school district or any group of 
        districts may receive a grant in the amount of $25 per pupil per 
        year.  The grant recipient must match one local dollar for every 
        state dollar received.  The local match may include in kind 
        contributions.  In awarding grants, the commissioner shall 
        consider which students will benefit most from these programs. 
           Sec. 25.  [PERFORMANCE FUNDING OPTIONS.] 
           Consistent with state high school graduation requirements, 
        statewide testing requirements, and other performance 
        indicators, the commissioner, in consultation with the state 
        board of education and appropriate stakeholders, shall recommend 
        to the legislature performance funding options for successful 
        schools and for schools at risk to be implemented for the 
        1999-2000 school year. 
           Sec. 26.  [DEADLINE AND PENALTY WAIVED.] 
           The deadline and penalty under Minnesota Statutes, section 
        124A.22, subdivision 2a, do not apply for aid payments for the 
        1998-1999 biennium. 
           Sec. 27.  [ST. PAUL COMMUNITY-BASED SCHOOL PROGRAM; 
        APPROPRIATION.] 
           $3,300,000 in fiscal year 1998 is appropriated from the 
        general fund to the commissioner of children, families, and 
        learning for a grant to independent school district No. 625, St. 
        Paul, for the establishment and operation of a community-based 
        school program.  The purpose of the program is to improve 
        student achievement and to provide an integrated set of 
        academic, health, social, and recreational support services 
        year-round, and for an extended day to children, families, and 
        the community. 
           Independent school district No. 625 shall collaborate with 
        the city of St. Paul; Ramsey county; the commissioner of 
        children, families, and learning; and a nonprofit operating 
        foundation located in St. Paul to establish and operate the 
        program.  Before implementing the program, the district must 
        submit the following to the commissioner: 
           (1) the name and address of the school or schools to be 
        community-based schools; 
           (2) the grade levels and number of students to be served; 
           (3) general demographic characteristics of the area and 
        students to be served; 
           (4) the education curriculum and other programs to be 
        offered; 
           (5) the goals of the school and the means to measure 
        student achievement; 
           (6) a budget and operating plan, including the governing 
        structure, financial commitments, and program commitments by the 
        city, county, and foundation to the program; and 
           (7) documentation of community support. 
           This money may also be used to construct, remodel, design, 
        renovate, equip, and repair facilities used for a 
        community-based school program.  This appropriation is available 
        until June 30, 1999. 
           $300,000 of this amount is for a grant for community-based 
        schools according to section 21.  The total appropriation in 
        fiscal years 1997 and 1998 under this section and section 21 
        shall not exceed $3,300,000. 
           Sec. 28.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated. 
           Subd. 2.  [STATEWIDE TESTING.] For implementing statewide 
        testing and establishing a performance baseline under section 25:
             $2,500,000     .....     1998 
             $2,500,000     .....     1999 
           The commissioner shall contract with an institution of 
        higher education to establish an independent office of 
        educational accountability. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 3.  [LABORATORY SCHOOL GRANTS.] For laboratory school 
        grants under section 23: 
             $2,500,000     .....     1998
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 4.  [ADVANCED PLACEMENT AND INTERNATIONAL 
        BACCALAUREATE PROGRAMS.] For the state advanced placement and 
        international baccalaureate programs: 
             $1,875,000     .....     1998 
             $1,875,000     .....     1999 
           Notwithstanding Minnesota Statutes, section 126.239, 
        subdivisions 1 and 2, $200,000 each year is for teachers to 
        attend subject matter summer training programs and follow-up 
        support workshops approved by the advanced placement or 
        international baccalaureate programs.  The amount of the subsidy 
        for each teacher attending an advanced placement or 
        international baccalaureate summer training program or workshop 
        shall be the same.  The commissioner shall determine the payment 
        process and the amount of the subsidy. 
           Notwithstanding Minnesota Statutes, section 126.239, 
        subdivision 3, in each year to the extent of available 
        appropriations, the commissioner shall pay all examination fees 
        for all students sitting for an advanced placement examination, 
        international baccalaureate examination, or both.  If this 
        amount is not adequate, the commissioner may pay less than the 
        full examination fee. 
           $300,000 each year is for student scholarships.  A student 
        scholarship shall be awarded to a student scoring three or 
        better on one or more advanced placement examinations or a four 
        or better on one or more international baccalaureate 
        examinations.  The amount of each scholarship shall range from 
        $150 to $500 based on the student's score on the exams.  The 
        scholarships shall be awarded only to students who are enrolled 
        in a Minnesota public or private college or university.  The 
        total amount of each scholarship shall be paid directly to the 
        student's designated college or university and must be used by 
        the student only for tuition, required fees, and books in 
        nonsectarian courses or programs.  The higher education services 
        office, in consultation with the commissioner, shall determine 
        the payment process, the amount of the scholarships, and 
        provisions for unused scholarships.  
           In order to be eligible to receive advanced placement or 
        international baccalaureate scholarships on behalf of the 
        qualifying students, the college or university must have an 
        advanced placement, international baccalaureate, or both, credit 
        and placement policy for the scholarship recipients.  In 
        addition, each college or university must certify these policies 
        to the department each year.  The department must provide each 
        secondary school in the state with a copy of the post-secondary 
        advanced placement and international baccalaureate policies each 
        year. 
           $375,000 each year is for teacher stipends.  A teacher who 
        teaches an advanced placement or international baccalaureate 
        course shall receive a stipend for each student in that 
        teacher's course who receives a three or better on the advanced 
        placement or a four or better on the international baccalaureate 
        examination that covers the subject matter of the course.  The 
        commissioner shall determine the payment process and the amount 
        of the teacher stipend ranging from $25 to $50 for each student 
        receiving a qualifying score. 
           A stipend awarded to a teacher under this subdivision shall 
        not be a mandatory subject of bargaining under Minnesota 
        Statutes, chapter 179A, or any other law and shall not be a term 
        or condition of employment.  The amount of any award shall be 
        final and shall not be subject to review by an arbitrator 
        through any grievance or other process or by a court through any 
        appeal process.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 5.  [TEACHER EDUCATION IMPROVEMENT.] For board of 
        teaching responsibilities relating to teacher licensure 
        restructuring and implementation of the teaching residency 
        program: 
             $450,000     .....     1998
             $450,000     .....     1999 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           The board of teaching shall use the funds for further 
        development of the results-oriented teacher licensure system, 
        for pilot site grants and other methods of implementing the 
        teacher residency program, and for programs relating to teacher 
        mentoring. 
           Subd. 6.  [SCIENCE-MATHEMATICS GRANT.] For continuation of 
        systemic change in science and mathematics education programs: 
             $1,352,000     .....     1998 
             $1,352,000     .....     1999
           $20,000 of the appropriation in 1998 and $20,000 in 1999 is 
        for the south central Minnesota talented youth program. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 7.  [MINNESOTA HOMEWORK HELPLINE; METRO HOMEWORK 
        HOTLINE.] For the Minnesota homework helpline and the metro 
        homework hotline: 
             $100,000       .....     1998 
             $100,000       .....     1999 
           These appropriations are available to assist students with 
        homework by telephone or other interactive technology.  The 
        program providers must offer assistance to students five days 
        per week.  The revenue allocated to each program is contingent 
        upon that program matching each $1 of state revenue with $2 of 
        local or private funding or in-kind contributions. 
           Subd. 8.  [GIFTED AND TALENTED GRANTS.] For grants for 
        gifted and talented programs according to section 24: 
             $1,500,000     .....     1998
             $1,500,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 9.  [COLLABORATIVE URBAN EDUCATOR PROGRAMS.] For 
        grants to collaborative urban educator programs that prepare and 
        license people of color to teach: 
             $895,000     .....     1998
           This appropriation is available until June 30, 1999. 
           Subd. 10.  [CHARTER SCHOOL BUILDING LEASE AID.] For 
        building lease aid according to section 124.248, subdivision 2a: 
             $1,078,000     .....     1998 
             $1,577,000     .....     1999 
           The 1999 appropriation includes $120,000 for 1998 and 
        $1,457,000 for 1999. 
           Subd. 11.  [CHARTER SCHOOL START-UP GRANTS.] For charter 
        school start-up cost aid under Minnesota Statutes, section 
        124.248: 
             $500,000       .....     1998 
             $1,000,000     .....     1999 
           Any balance in the first year does not cancel but is 
        available in the second year.  This appropriation may also be 
        used for grants to convert existing schools into charter schools.
           Subd. 12.  [GRADUATION RULE IMPLEMENTATION AT THE SITE 
        AID.] For graduation rule implementation: 
             $10,000,000     .....     1998
           (a) This appropriation shall be paid to districts according 
        to paragraph (b).  The purpose of the aid is to accelerate the 
        implementation of the graduation rule throughout all education 
        sites in the district through intensive staff development and 
        decentralized decision making.  The board shall work with the 
        teaching staff in the district to determine the most effective 
        staff development processes to assure an acceleration of the 
        implementation.  This appropriation is one-time only. 
           (b) A district shall receive aid equal to $10 times the 
        number of pupil units in the district for fiscal year 1998.  At 
        least 30 percent must be used for the purposes of paragraph (a). 
           Subd. 13.  [WEST ST. PAUL-MENDOTA HEIGHTS-EAGAN GRANT.] For 
        a grant to independent school district No. 197, West St. 
        Paul-Mendota Heights-Eagan, for implementing multiple pathways 
        for students to meet graduation standards: 
             $167,000     .....     1998
           The district must match the grant in an amount determined 
        by the commissioner of children, families, and learning.  The 
        appropriation is available until June 30, 1999. 
           Subd. 14.  [PROFESSIONAL TEACHING STANDARDS CERTIFICATION 
        GRANTS.] For grants to teachers for professional teaching 
        standards certification: 
             $400,000     .....     1998
           This appropriation shall be used for grants to eligible 
        teachers accepted as candidates for national board for 
        professional teaching standards certification; for grants to 
        eligible teachers who have earned national board for 
        professional teaching standards certification for purchasing 
        instructional materials, equipment, or supplies and realizing 
        professional development opportunities; and for the commissioner 
        to pay for four half-time state coordinators that grants to 
        school districts working cooperatively to establish support 
        networks to counsel and assist teacher candidates for national 
        board for professional teaching standards certification.  The 
        grants must be used to hire up to four half-time statewide 
        coordinators who must be licensed kindergarten through grade 12 
        public school teachers.  The commissioner shall determine the 
        form and manner for grant applications.  Applications must 
        include an implementation plan that demonstrates collaboration 
        among school districts and professional organizations in 
        providing support activities to facilitate the work of the 
        coordinators.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 15.  [SCHOOL ENRICHMENT PARTNERSHIP PROGRAM.] For 
        school enrichment partnership program aid according to Minnesota 
        Statutes, section 124.255: 
             $500,000      .....      1998 
           Any balance remaining in the first year does not cancel but 
        is available in the second year. 
           Subd. 16.  [EARLY INTERVENTION READING CHALLENGE 
        GRANTS.] For early intervention reading challenge grants: 
             $500,000     .....     1998
           The commissioner of children, families, and learning shall 
        make grants to school sites to train teachers and adopt 
        curriculum enhancements that provide intense instruction for 
        students with difficulty learning to read.  Priority shall be 
        given to school sites that are committed to significantly 
        increasing the percentage of students who are able to read at 
        grade level by the end of third grade and have high 
        concentrations of students receiving free and reduced lunch.  
        The grant money may be used for establishing the school site as 
        a training site for teachers in other districts, teacher 
        training, or other start-up costs related to curriculum 
        enhancements for early intervention reading programs for 
        children in primary grades.  The grant recipients must match one 
        local dollar for every state dollar received.  The local match 
        may include in-kind contributions.  The commissioner shall 
        consider regional balance in distributing grants. 
           Subd. 17.  [YEAR-ROUND SCHOOL/EXTENDED WEEK OR DAY GRANTS.] 
        For year-round school/extended week or day grants under Laws 
        1995, First Special Session chapter 3, article 7, section 4: 
             $1,800,000     .....     1998 
           The department of children, families, and learning must 
        award grants to school districts with priority given to programs 
        that have not previously received year-round school/extended 
        week or day pilot grants.  Of this amount, $500,000 is for a 
        grant to independent school district No. 624, White Bear Lake.  
        Of this amount, $225,000 is for a year-round school extended day 
        project in independent school district No. 911, Cambridge.  Of 
        this amount, $200,000 is for the four-period day program at 
        independent school district No. 833, south Washington county.  
        The maximum grant amount for other recipients is $300,000.  
        Grant recipients are required to make reports on progress made, 
        planning, and implementing projects in the form and manner 
        specified by the department of children, families, and learning. 
           The senior high site councils in the independent school 
        district No. 833, south Washington county, shall develop and 
        implement a model four-period day curriculum during the 
        1997-1998 and 1998-1999 school years.  The site councils shall 
        seek input from parents, teachers, and students in the design 
        and implementation of the four-period day model.  If one or more 
        site councils determine a four-period day model is not 
        desirable, the site council shall report its recommendations 
        back to the board and need not proceed with the development and 
        implementation of the model. 
           The south Washington county school board shall develop a 
        system for monitoring and evaluating the development and 
        implementation of the four-period day models at its high 
        schools.  The board shall monitor and evaluate:  (1) the process 
        used by the site council to discuss, develop, and implement a 
        four-period day; and (2) the academic outcomes of students after 
        the four-period day has been fully implemented.  To evaluate the 
        academic outcomes of students, the district shall compare the 
        academic achievement of its high school students with the 
        achievement of students in similar school districts using a 
        six-period day model.  The board shall report the results of its 
        evaluation to the commissioner of children, families, and 
        learning on August 30, 1998, and August 30, 1999.  The reports 
        shall include a detailed description of the site-based, 
        decision-making model that was used to develop and implement the 
        four-period day and the steps that were taken to successfully 
        implement and evaluate the model. 
           Independent school district No. 833, South Washington 
        County, shall complete a class size mitigation pilot project to 
        explore options for improving learning outcomes in elementary 
        and junior high classrooms with 30 or more students.  The 
        options for mitigating the adverse impacts of large class sizes 
        shall be developed and implemented using a site-based management 
        decision-making process.  The district shall report the results 
        of its pilot project to the commissioner of children, families, 
        and learning by August 30, 1998. 
           Sec. 29.  [REPEALER.] 
           Minnesota Statutes 1996, section 121.11, subdivision 8, is 
        repealed. 
           Sec. 30.  [EFFECTIVE DATE.] 
           If this act is enacted on or after July 1, 1997, sections 1 
        to 29 are effective the day following final enactment. 
                                   ARTICLE 6 
                              ACADEMIC PERFORMANCE 
           Section 1.  Minnesota Statutes 1996, section 120.101, 
        subdivision 5, is amended to read: 
           Subd. 5.  [AGES AND TERMS.] For the 1988-1989 school year 
        and the school years thereafter, Every child between seven and 
        16 years of age shall receive instruction for at least the 
        number of days each year required under subdivision 5b.  For the 
        2000-2001 school year and later school years, every child 
        between seven and 18 years of age shall receive instruction for 
        at least the number of days each year required under subdivision 
        5b.  Every child under the age of seven who is enrolled in a 
        half-day kindergarten, or a full-day kindergarten program on 
        alternate days, or other kindergarten programs shall receive 
        instruction at least equivalent to half of each day for the 
        number of days each year set out in subdivision 5b.  Except as 
        provided in subdivision 5a, a parent may withdraw a child under 
        the age of seven from enrollment at any time. 
           Sec. 2.  Minnesota Statutes 1996, section 120.101, is 
        amended by adding a subdivision to read: 
           Subd. 5d.  [WITHDRAWAL FROM SCHOOL.] Any student between 16 
        and 18 years old who seeks to withdraw from school, and the 
        student's parent or guardian must: 
           (1) attend a meeting with school personnel to discuss the 
        educational opportunities available to the student, including 
        alternative educational opportunities; and 
           (2) sign a written election to withdraw from school. 
           Sec. 3.  [120.1015] [LENGTH OF SCHOOL YEAR; DAYS OF 
        INSTRUCTION.] 
           A school board's annual school calendar shall include at 
        least three additional days of student instruction beyond the 
        number of days of student instruction the board formally adopted 
        as its school calendar at the beginning of the 1996-1997 school 
        year. 
           Sec. 4.  Minnesota Statutes 1996, section 121.602, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROGRAM OUTCOMES.] The outcomes of the 
        educational effectiveness program are to: 
           (1) increase meaningful parental involvement in site-based 
        decision making; 
           (2) improve results-oriented instructional educational 
        processes; 
           (3) create flexible school-based organizational structures; 
        and 
           (4) improve student achievement. 
           Sec. 5.  Minnesota Statutes 1996, section 121.602, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ADVISORY TASK FORCE; PROGRAM IMPLEMENTATION.] 
        The commissioner of children, families, and learning shall 
        develop and maintain a program of educational effectiveness and 
        results-oriented instruction education.  The commissioner may 
        appoint an advisory task force to assist the department of 
        children, families, and learning in developing an implementation 
        program for providing staff development to school district staff 
        in educational effectiveness.  The program shall be based on 
        established principles of instructional design and the essential 
        elements of effective instruction as determined by educational 
        research.  The program shall take into account the diverse needs 
        of the school districts due to such factors as district size and 
        location. 
           Sec. 6.  Minnesota Statutes 1996, section 121.602, 
        subdivision 4, is amended to read: 
           Subd. 4.  [EDUCATIONAL EFFECTIVENESS STAFF DEVELOPMENT.] 
        The department of children, families, and learning shall provide 
        assistance to the school districts in implementing an 
        educational effectiveness program.  In selecting an agency to 
        provide assistance to the school districts, the department shall 
        consider such factors as support of the proposal by the 
        participating school districts and the extent to which the 
        proposal provides for participation by school district staff.  
        The department shall evaluate the performance of the service 
        providers.  The staff development shall be facilitated by 
        building level decision-making teams.  The staff development 
        shall include clarification of individual school missions, 
        goals, expectations, enhancement of collaborative planning and 
        collegial relationships among the building staff, improvement of 
        curriculum, assessment, instructional and organizational skills, 
        improvement of financial and management skills, and planning of 
        other staff development programs. 
           Sec. 7.  Minnesota Statutes 1996, section 123.35, 
        subdivision 8, is amended to read: 
           Subd. 8.  The board may establish and maintain public 
        evening schools and adult and continuing education programs and 
        such evening schools and adult and continuing education programs 
        when so maintained shall be available to all persons over 16 
        years of age through the 1999-2000 school year and over 18 years 
        of age beginning with the 2000-2001 school year who, from any 
        cause, are unable to attend the full-time elementary or 
        secondary schools of such district. 
           Sec. 8.  Minnesota Statutes 1996, section 123.70, 
        subdivision 5, is amended to read: 
           Subd. 5.  If a person transfers from one elementary or 
        secondary school to another, the person shall be allowed school 
        board of a public school district or the administrator of a 
        nonpublic school may allow the person up to a maximum of 30 days 
        to submit one or more of the statements as specified in 
        subdivision 1 or 3, during which time the person may enroll in 
        and attend the school.  If a person enrolls in a child care 
        facility in which at least 75 percent of children in the 
        facility participate on a one-time only or occasional basis to a 
        maximum of 45 hours per child, per month, or is placed in a 
        facility by a crisis nursery, the person shall be exempt from 
        all requirements of this section for up to five consecutive 
        days, starting from the first day of attendance. 
           Sec. 9.  Minnesota Statutes 1996, section 123.70, 
        subdivision 7, is amended to read: 
           Subd. 7.  Each school or child care facility shall maintain 
        on file immunization records for all persons in attendance that 
        contain the information required by subdivisions 1, 2, and 3.  
        The school shall maintain the records for at least five years 
        after the person attains the age of majority.  The department of 
        health and the board of health, as defined in section 145A.02, 
        subdivision 2, in whose jurisdiction the school or child care 
        facility is located, shall have access to the files maintained 
        pursuant to this subdivision.  When a person transfers to 
        another elementary or secondary school or child care facility, 
        the administrator or other person having general control and 
        supervision of the school or child care facility shall assist 
        the person's parent or guardian in the transfer of the 
        immunization file to the person's new school or child care 
        facility within 30 days of the transfer.  Upon the request of a 
        public or private post-secondary educational institution, as 
        defined in section 135A.14, the administrator or other person 
        having general control or supervision of a school shall assist 
        in the transfer of a student's immunization file to the 
        post-secondary institution. 
           Sec. 10.  Minnesota Statutes 1996, section 123.70, 
        subdivision 10, is amended to read: 
           Subd. 10.  A statement required to be submitted under 
        subdivisions 1, 2, and 4 to document evidence of immunization 
        shall include month, day, and year for immunizations 
        administered after January 1, 1990.  
           (a) For persons enrolled in grades 7 and 12 during the 
        1996-1997 school term, the statement must indicate that the 
        person has received a dose of tetanus and diphtheria toxoid no 
        earlier than 11 years of age. 
           (b) Except as specified in paragraph (e), for persons 
        enrolled in grades 7, 8, and 12 during the 1997-1998 school 
        term, the statement must indicate that the person has received a 
        dose of tetanus and diphtheria toxoid no earlier than 11 years 
        of age.  
           (c) Except as specified in paragraph (e), for persons 
        enrolled in grades 7, 8, 9, and through 12 during the 1998-1999 
        school term and for each year thereafter, the statement must 
        indicate that the person has received a dose of tetanus and 
        diphtheria toxoid no earlier than 11 years of age.  
           (d) for persons enrolled in grades 7, 8, 9, 10, and 12 
        during the 1999-2000 school term, the statement must indicate 
        that the person has received a dose of tetanus and diphtheria 
        toxoid no earlier than 11 years of age.  
           (e) for persons enrolled in grades 7 through 12 during the 
        2000-2001 school term and for each year thereafter, the 
        statement must indicate that the person has received a dose of 
        tetanus and diphtheria toxoid no earlier than 11 years of age. 
           (f) (d) For persons enrolled in grades 7 through 12 during 
        the 1996-1997 school year and for each year thereafter, the 
        statement must indicate that the person has received at least 
        two doses of vaccine against measles, mumps, and rubella, given 
        alone or separately and given not less than one month apart. 
           (e) A person who has received at least three doses of 
        tetanus and diphtheria toxoids, with the most recent dose given 
        after age six and before age 11, is not required to have 
        additional immunization against diphtheria and tetanus until ten 
        years have elapsed from the person's most recent dose of tetanus 
        and diphtheria toxoid. 
           Sec. 11.  Minnesota Statutes 1996, section 124.26, 
        subdivision 1b, is amended to read: 
           Subd. 1b.  [PROGRAM REQUIREMENTS.] An adult basic education 
        program is a day or evening program offered by a district that 
        is for people over 16 years of age through the 1999-2000 school 
        year and over 18 years of age beginning with the 2000-2001 
        school year who do not attend an elementary or secondary 
        school.  The program offers academic instruction necessary to 
        earn a high school diploma or equivalency certificate.  Tuition 
        and fees may not be charged to a learner for instruction paid 
        under this section, except for a security deposit to assure 
        return of materials, supplies, and equipment. 
           Sec. 12.  Minnesota Statutes 1996, section 124.276, is 
        amended by adding a subdivision to read: 
           Subd. 2a.  [AID.] A district with an approved plan shall 
        receive $30 per pupil served at the school site with the family 
        connections program.  The district must provide a match of $15 
        per pupil served at the school site with the family connections 
        program. 
           Sec. 13.  [124.6475] [SUMMER FOOD SERVICE REPLACEMENT AID.] 
           States funds are available to compensate 
        department-approved summer food program sponsors for reduced 
        federal operating reimbursement rates under Public Law Number 
        104-193, the federal summer food service program.  A sponsor is 
        eligible for summer food service replacement aid equal to the 
        sum of the following amounts: 
           (1) for breakfast service, subtract the current year 
        maximum reimbursement rate from the 1996 maximum reimbursement 
        rate and multiply the result by the number of breakfasts the 
        district served during the current school year; 
           (2) for lunch or supper service, subtract the current year 
        maximum reimbursement rate from the 1996 maximum reimbursement 
        rate and multiply the result by the number of lunches and 
        suppers the district served during the current school year; and 
           (3) for supplement service, subtract the current year 
        maximum reimbursement rate from the 1996 maximum reimbursement 
        rate and multiply the result by the number of supplement meals 
        the district served during the current school year. 
           Sec. 14.  Minnesota Statutes 1996, section 124C.46, 
        subdivision 2, is amended to read: 
           Subd. 2.  [PEOPLE TO BE SERVED.] A center shall provide 
        programs for secondary pupils and adults, giving priority to 
        serving persons between 16 and 21 years of age.  Secondary 
        pupils to be served are those who are chemically dependent, not 
        likely to graduate from high school, need assistance in 
        vocational and basic skills, can benefit from employment 
        experiences, and need assistance in transition from school to 
        employment.  Adults to be served are dislocated homemakers and 
        workers and others who need basic educational and social 
        services.  In addition to offering programs, the center shall 
        coordinate the use of other available educational services, 
        social services, and post-secondary institutions in the 
        community.  The A center may also provide programs, including 
        work-based, service-learning, and applied learning opportunities 
        developed in collaboration with a local education and employment 
        transitions partnership, and services for elementary and 
        secondary pupils who are not attending the center to assist them 
        in completing high being successful in school.  Pupils eligible 
        to be served are those age five to adults 21 and older who 
        qualify under the graduation incentives program in section 
        126.22, subdivision 2. 
           Sec. 15.  Minnesota Statutes 1996, section 126.22, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ELIGIBLE PUPILS.] The following pupils are 
        eligible to participate in the education options graduation 
        incentives program:  
           (a) any pupil under the age of 21 who:  
           (1) performs substantially below the performance level for 
        pupils of the same age in a locally determined achievement test; 
        or 
           (2) is at least one year behind in satisfactorily 
        completing coursework or obtaining credits for graduation; or 
           (3) is pregnant or is a parent; or 
           (4) has been assessed as chemically dependent; or 
           (5) has been excluded or expelled according to sections 
        127.26 to 127.39; or 
           (6) has been referred by a school district for enrollment 
        in an eligible program or a program pursuant to section 126.23; 
        or 
           (7) is a victim of physical or sexual abuse; or 
           (8) has experienced mental health problems; or 
           (9) has experienced homelessness sometime within six months 
        before requesting a transfer to an eligible program; or 
           (10) speaks English as a second language or has limited 
        English proficiency; or 
           (11) has withdrawn from school or has been chronically 
        truant; or 
           (b) any person who is at least 21 years of age and who:  
           (1) has received fewer than 14 years of public or nonpublic 
        education, beginning at age 5; 
           (2) has not completed the requirements for a high school 
        diploma; and 
           (3) at the time of application, (i) is eligible for 
        reemployment insurance benefits or has exhausted the benefits, 
        (ii) is eligible for, or is receiving income maintenance and 
        support services, as defined in section 268.0111, subdivision 5, 
        or (iii) is eligible for services under the displaced homemaker 
        program, state wage-subsidy program, or any programs under the 
        federal Jobs Training Partnership Act or its successor. 
           Sec. 16.  Minnesota Statutes 1996, section 144.29, is 
        amended to read: 
           144.29 [HEALTH RECORDS; CHILDREN OF SCHOOL AGE.] 
           It shall be the duty of every school nurse, school 
        physician, school attendance officer, superintendent of schools, 
        principal, teacher, and of the persons charged with the duty of 
        compiling and keeping the school census records, to cause a 
        permanent public health record to be kept for each child of 
        school age.  Such record shall be kept in such form that it may 
        be transferred with the child to any school which the child 
        shall attend within the state and transferred to the 
        commissioner when the child ceases to attend school.  It shall 
        contain a record of such health matters as shall be prescribed 
        by the commissioner, and of all mental and physical defects and 
        handicaps which might permanently cripple or handicap the 
        child student health data as defined in section 13.32, 
        subdivision 2, paragraph (a), and shall be classified as private 
        data as defined in section 13.32, subdivision 3.  Nothing in 
        sections 144.29 to 144.32 shall be construed to require any 
        child whose parent or guardian objects in writing thereto to 
        undergo a physical or medical examination or treatment.  A copy 
        shall be forwarded to the proper department of any state to 
        which the child shall remove.  Each district shall assign a 
        teacher, school nurse, or other professional person to review, 
        at the beginning of each school year, the health record of all 
        pupils under the assignee's direction.  Growth, results of 
        vision and hearing screening, and findings obtained from health 
        assessments must be entered periodically on the pupil's health 
        record. 
           Sec. 17.  Minnesota Statutes 1996, section 260.185, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [COURT ORDER, FINDINGS, REMEDIES, 
        TREATMENT.] If the court finds that the child is delinquent, it 
        shall enter an order making any of the following dispositions of 
        the case which are deemed necessary to the rehabilitation of the 
        child: 
           (a) Counsel the child or the parents, guardian, or 
        custodian; 
           (b) Place the child under the supervision of a probation 
        officer or other suitable person in the child's own home under 
        conditions prescribed by the court including reasonable rules 
        for the child's conduct and the conduct of the child's parents, 
        guardian, or custodian, designed for the physical, mental, and 
        moral well-being and behavior of the child, or with the consent 
        of the commissioner of corrections, in a group foster care 
        facility which is under the management and supervision of said 
        commissioner; 
           (c) Subject to the supervision of the court, transfer legal 
        custody of the child to one of the following: 
           (1) a child-placing agency; or 
           (2) the local social services agency; or 
           (3) a reputable individual of good moral character.  No 
        person may receive custody of two or more unrelated children 
        unless licensed as a residential facility pursuant to sections 
        245A.01 to 245A.16; or 
           (4) a county home school, if the county maintains a home 
        school or enters into an agreement with a county home school; or 
           (5) a county probation officer for placement in a group 
        foster home established under the direction of the juvenile 
        court and licensed pursuant to section 241.021; 
           (d) Transfer legal custody by commitment to the 
        commissioner of corrections; 
           (e) If the child is found to have violated a state or local 
        law or ordinance which has resulted in damage to the person or 
        property of another, the court may order the child to make 
        reasonable restitution for such damage; 
           (f) Require the child to pay a fine of up to $700; the 
        court shall order payment of the fine in accordance with a time 
        payment schedule which shall not impose an undue financial 
        hardship on the child; 
           (g) If the child is in need of special treatment and care 
        for reasons of physical or mental health, the court may order 
        the child's parent, guardian, or custodian to provide it.  If 
        the parent, guardian, or custodian fails to provide this 
        treatment or care, the court may order it provided; 
           (h) If the court believes that it is in the best interests 
        of the child and of public safety that the driver's license of 
        the child be canceled until the child's 18th birthday, the court 
        may recommend to the commissioner of public safety the 
        cancellation of the child's license for any period up to the 
        child's 18th birthday, and the commissioner is hereby authorized 
        to cancel such license without a hearing.  At any time before 
        the termination of the period of cancellation, the court may, 
        for good cause, recommend to the commissioner of public safety 
        that the child be authorized to apply for a new license, and the 
        commissioner may so authorize. 
           (i) If the court believes that it is in the best interest 
        of the child and of public safety that the child is enrolled in 
        school, the court may require the child to remain enrolled in a 
        public school until the child reaches the age of 18 or completes 
        all requirements needed to graduate from high school.  Any child 
        enrolled in a public school under this paragraph is subject to 
        the provisions of the Pupil Fair Dismissal Act in chapter 127. 
           If the child is petitioned and found by the court to have 
        committed a controlled substance offense under sections 152.021 
        to 152.027, the court shall determine whether the child 
        unlawfully possessed or sold the controlled substance while 
        driving a motor vehicle.  If so, the court shall notify the 
        commissioner of public safety of its determination and order the 
        commissioner to revoke the child's driver's license for the 
        applicable time period specified in section 152.0271.  If the 
        child does not have a driver's license or if the child's 
        driver's license is suspended or revoked at the time of the 
        delinquency finding, the commissioner shall, upon the child's 
        application for driver's license issuance or reinstatement, 
        delay the issuance or reinstatement of the child's driver's 
        license for the applicable time period specified in section 
        152.0271.  Upon receipt of the court's order, the commissioner 
        is authorized to take the licensing action without a hearing. 
           If the child is petitioned and found by the court to have 
        committed or attempted to commit an act in violation of section 
        609.342; 609.343; 609.344; 609.345; 609.3451; 609.746, 
        subdivision 1; 609.79; or 617.23, or another offense arising out 
        of a delinquency petition based on one or more of those 
        sections, the court shall order an independent professional 
        assessment of the child's need for sex offender treatment.  An 
        assessor providing an assessment for the court must be 
        experienced in the evaluation and treatment of juvenile sex 
        offenders. If the assessment indicates that the child is in need 
        of and amenable to sex offender treatment, the court shall 
        include in its disposition order a requirement that the child 
        undergo treatment.  Notwithstanding section 13.42, 13.85, 
        144.335, 260.161, or 626.556, the assessor has access to the 
        following private or confidential data on the child if access is 
        relevant and necessary for the assessment: 
           (1) medical data under section 13.42; 
           (2) corrections and detention data under section 13.85; 
           (3) health records under section 144.335; 
           (4) juvenile court records under section 260.161; and 
           (5) local welfare agency records under section 626.556. 
           Data disclosed under this paragraph may be used only for 
        purposes of the assessment and may not be further disclosed to 
        any other person, except as authorized by law. 
           If the child is found delinquent due to the commission of 
        an offense that would be a felony if committed by an adult, the 
        court shall make a specific finding on the record regarding the 
        juvenile's mental health and chemical dependency treatment needs.
           Any order for a disposition authorized under this section 
        shall contain written findings of fact to support the 
        disposition ordered, and shall also set forth in writing the 
        following information: 
           (a) why the best interests of the child are served by the 
        disposition ordered; and 
           (b) what alternative dispositions were considered by the 
        court and why such dispositions were not appropriate in the 
        instant case. 
           Sec. 18.  [REGIONAL TRAINING SITES FOR HIV EDUCATION IN 
        SCHOOLS.] 
           The commissioner of children, families, and learning shall 
        establish four regional training centers in partnership with 
        school districts outside of the cities of Minneapolis and St. 
        Paul to implement comprehensive curriculum and program to 
        prevent and reduce the risk of HIV/AIDS as required under 
        Minnesota Statutes, section 121.203.  The commissioner shall 
        provide technical and financial assistance to each school 
        district to identify policy, curriculum, and service gaps, to 
        purchase curriculum and materials and to provide training or 
        services to fill these gaps, to identify opportunities to 
        coordinate HIV education with other special curriculum 
        offerings, and to assess the effectiveness of curriculum and 
        services.  Each regional training center will provide programs 
        and services to nearby school districts to meet the requirements 
        of Minnesota Statutes, section 121.203.  The commissioner and 
        each school district shall work with a community advisory 
        committee to establish and review the operation of each training 
        center. 
           Sec. 19.  [TARGETED BREAKFAST GRANTS.] 
           Subdivision 1.  [ESTABLISHMENT.] A grant program is 
        established to further explore the policy of providing 
        nutritious breakfasts to public elementary school children, 
        without regard to whether the children are eligible to receive 
        free or reduced price meals, so that they can learn effectively. 
           Subd. 2.  [ELIGIBILITY.] An applicant for a grant must be 
        an elementary school that participates in the federal school 
        breakfast and lunch programs.  For a school to receive a grant, 
        at least 33 percent of the lunches the school served to children 
        during the preceding school year must have been provided free or 
        at a reduced price. 
           Subd. 3.  [APPLICATION PROCESS.] To obtain a grant to 
        receive reimbursement for providing breakfasts to all children, 
        whether or not the children are from low-income families and 
        eligible to receive free or reduced price meals, a public 
        elementary school must submit an application to the commissioner 
        of children, families, and learning in the form and manner the 
        commissioner prescribes.  The application must describe how the 
        applicant will encourage all children in the school to 
        participate in the breakfast program.  The applicant also must 
        demonstrate to the commissioner that the applicant will receive 
        a $1 local match of funding or in-kind contributions for every 
        $3 of state funding the applicant receives.  The commissioner 
        may require additional information from the applicant. 
           Subd. 4.  [GRANT AWARDS.] The commissioner shall award 
        grants to the four grant recipients under Laws 1994, chapter 
        647, article 8, section 35, and then on a first-come, 
        first-served basis to all other schools that meet the 
        requirements of subdivisions 2 and 3 until funding under this 
        section is expended.  The commissioner shall determine the 
        amount of the grant using average statewide statistics and 
        individual school statistics adjusted for other state and 
        federal reimbursements.  Grant recipients must use the proceeds 
        to provide breakfasts to school children every day school is in 
        session. 
           Sec. 20.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated.  
           Subd. 2.  [ABATEMENT AID.] For abatement aid according to 
        Minnesota Statutes, section 124.214:  
             $13,661,000    .....     1998 
             $13,612,000    .....     1999 
           The 1998 appropriation includes $684,000 for 1997 and 
        $12,977,000 for 1998.  
           The 1999 appropriation includes $1,441,000 for 1998 and 
        $12,171,000 for 1999.  
           Subd. 3.  [NONPUBLIC PUPIL AID.] For nonpublic pupil 
        education aid according to Minnesota Statutes, sections 123.79 
        and 123.931 to 123.947: 
             $9,430,000     .....      1998 
             $9,688,000     .....      1999 
           The 1998 appropriation includes $900,000 for 1997 and 
        $8,530,000 for 1998. 
           The 1999 appropriation includes $947,000 for 1998 and 
        $8,741,000 for 1999. 
           Subd. 4.  [SCHOOL LUNCH AND FOOD STORAGE AID.] (a) For 
        school lunch aid according to Minnesota Statutes, section 
        124.646, and Code of Federal Regulations, title 7, section 
        210.17, and for food storage and transportation costs for United 
        States Department of Agriculture donated commodities; and for a 
        temporary transfer to the commodity processing revolving fund to 
        provide cash flow to permit schools and other recipients of 
        donated commodities to take advantage of volume processing rates 
        and for school milk aid according to Minnesota Statutes, section 
        124.648:  
             $7,254,000     .....     1998 
             $7,254,000     .....     1999 
           (b) Any unexpended balance remaining from the 
        appropriations in this subdivision shall be prorated among 
        participating schools based on the number of free, reduced, and 
        fully paid federally reimbursable student lunches served during 
        that school year.  
           (c) If the appropriation amount attributable to either year 
        is insufficient, the rate of payment for each fully paid student 
        lunch shall be reduced and the aid for that year shall be 
        prorated among participating schools so as not to exceed the 
        total authorized appropriation for that year.  
           (d) Any temporary transfer processed in accordance with 
        this subdivision to the commodity processing fund will be 
        returned by June 30 in each year so that school lunch aid and 
        food storage costs can be fully paid as scheduled.  
           (e) Not more than $800,000 of the amount appropriated each 
        year may be used for school milk aid. 
           (f) The commissioner may reduce other future aid and grant 
        payments due to school districts and other organizations for the 
        costs of processing and storage of commodities used by the 
        district or organization. 
           Subd. 5.  [SUMMER FOOD SERVICE.] For summer food service: 
             $15,000        .....     1998
             $15,000        .....     1999
           Subd. 6.  [SCHOOL BREAKFAST.] To operate the school 
        breakfast program according to Minnesota Statutes, sections 
        124.6469 and 124.6472: 
             $456,000       .....     1998
             $456,000       .....     1999
           If the appropriation amount attributable to either year is 
        insufficient, the rate of payment for each fully paid student 
        breakfast shall be reduced and the aid for that year shall be 
        prorated among participating schools so as not to exceed the 
        total authorized appropriation for that year.  Any unexpected 
        balance remaining shall be used to subsidize the payments made 
        for school lunch aid per Minnesota Statutes, section 124.646.  
           Up to one percent of the program funding can be used by the 
        department of children, families, and learning for technical and 
        administrative assistance. 
           Subd. 7.  [SCHOOL BREAKFAST OUTREACH.] To initiate school 
        breakfast programs under Minnesota Statutes, section 124.6469, 
        at school sites not currently providing a school breakfast 
        program or at schools that initiated a school breakfast program 
        during the 1996-1997 school year: 
             $15,000        .....     1998 
             $15,000        .....     1999 
           Subd. 8.  [SUMMER FOOD SERVICE REPLACEMENT AID.] For summer 
        food service replacement aid under Minnesota Statutes, section 
        124.6475: 
             $150,000       .....     1998 
             $150,000       .....     1999 
           Subd. 9.  [TARGETED BREAKFAST GRANTS.] For targeted 
        breakfast grants: 
             $1,037,000     .....     1998 
           This appropriation is available until June 30, 1999. 
           Subd. 10.  [FAMILY CONNECTIONS AID.] For family connections 
        aid according to Minnesota Statutes, section 124.276: 
             $250,000       .....     1998
             $250,000       .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 11.  [NETT LAKE COMMUNITY CENTER.] For a grant to 
        independent school district No. 707, Nett Lake, for maintenance 
        replacement funds to cover delayed lease payments for the 
        collaborative community center: 
             $70,000     .....     1998 
           Subd. 12.  [HIV EDUCATION TRAINING SITES.] For regional 
        training sites for HIV education in schools: 
             $200,000    .....     1998
           This appropriation is contingent on a matching grant of 
        $100,000 in federal funds. 
           This appropriation is available until June 30, 1999. 
           Subd. 13.  [WILLMAR.] For a grant to independent school 
        district No. 347, Willmar: 
             $200,000     .....     1998 
           This appropriation shall be used to improve community 
        understanding of the cultures within the community, improve 
        communication between the district and the Latino community, 
        improve parental involvement in the school, to use mediation to 
        resolve conflict in the school and community, and to assist 
        surrounding communities and districts in achieving these goals. 
           This appropriation is available only if the federal lawsuit 
        against the district is dismissed for settlement. 
           This appropriation is available until June 30, 1999. 
           Subd. 14.  [PSEO REPLACEMENT AID.] For PSEO replacement aid:
             $12,000     .....     1998 
           The 1998 appropriation includes $12,000 for 1997 and $0 for 
        1998. 
           Sec. 21.  [REPEALER.] 
           Minnesota Statutes 1996, sections 121.602, subdivisions 3 
        and 5; 124.177; and 124.276, subdivision 2, are repealed. 
           Sec. 22.  [EFFECTIVE DATE.] 
           (a) Section 3 is effective for the 1998-1999 school year. 
           (b) If this act is enacted on or after July 1, 1997, all 
        sections in this article except for that section listed in 
        paragraph (a) are effective the day following final enactment. 
                                   ARTICLE 7
                            EDUCATION POLICY ISSUES
           Section 1.  Minnesota Statutes 1996, section 12.21, 
        subdivision 3, is amended to read: 
           Subd. 3.  [SPECIFIC AUTHORITY.] In performing duties under 
        this chapter and to effect its policy and purpose, the governor 
        may: 
           (1) make, amend, and rescind the necessary orders and rules 
        to carry out the provisions of this chapter and section 216C.15 
        within the limits of the authority conferred by this section, 
        with due consideration of the plans of the federal government 
        and without complying with sections 14.001 to 14.69, but no 
        order or rule has the effect of law except as provided by 
        section 12.32; 
           (2) ensure that a comprehensive emergency operations plan 
        and emergency management program for this state are developed 
        and maintained, and are integrated into and coordinated with the 
        emergency plans of the federal government and of other states to 
        the fullest possible extent; 
           (3) in accordance with the emergency operations plan and 
        the emergency management program of this state, procure supplies 
        and equipment, institute training programs and public 
        information programs, and take all other preparatory steps, 
        including the partial or full activation of emergency management 
        organizations in advance of actual disaster to ensure the 
        furnishing of adequately trained and equipped forces of 
        emergency management personnel in time of need; 
           (4) make studies and surveys of the industries, resources, 
        and facilities in this state as may be necessary to ascertain 
        the capabilities of the state for emergency management and to 
        plan for the most efficient emergency use of those industries, 
        resources, and facilities; 
           (5) on behalf of this state, enter into mutual aid 
        arrangements or cooperative agreements with other states and 
        with Canadian provinces, and coordinate mutual aid plans between 
        political subdivisions of this state; 
           (6) delegate administrative authority vested in the 
        governor under this chapter, except the power to make rules, and 
        provide for the subdelegation of that authority; 
           (7) cooperate with the president and the heads of the armed 
        forces, the emergency management agency of the United States and 
        other appropriate federal officers and agencies, and with the 
        officers and agencies of other states in matters pertaining to 
        the emergency management of the state and nation, including the 
        direction or control of: 
           (i) emergency preparedness drills and exercises; 
           (ii) warnings and signals for drills or actual emergencies 
        and the mechanical devices to be used in connection with them; 
           (iii) shutting off water mains, gas mains, electric power 
        connections and the suspension of all other utility services; 
           (iv) the conduct of persons in the state and the movement 
        and cessation of movement of pedestrians and vehicular traffic 
        during, prior, and subsequent to drills or actual emergencies; 
           (v) public meetings or gatherings; and 
           (vi) the evacuation, reception, and sheltering of persons; 
           (8) contribute to a political subdivision, within the 
        limits of the appropriation for that purpose, not more than 25 
        percent of the cost of acquiring organizational equipment that 
        meets standards established by the governor; 
           (9) formulate and execute, with the approval of the 
        executive council, plans and rules for the control of traffic in 
        order to provide for the rapid and safe movement over public 
        highways and streets of troops, vehicles of a military nature, 
        materials for national defense and war or for use in any war 
        industry, for the conservation of critical materials or for 
        emergency management purposes, and coordinate the activities of 
        the departments or agencies of the state and its political 
        subdivisions concerned directly or indirectly with public 
        highways and streets, in a manner that will best effectuate 
        those plans; 
           (10) alter or adjust by executive order, without complying 
        with sections 14.01 to 14.69, the working hours, work days and 
        work week of, and annual and sick leave provisions and payroll 
        laws regarding all state employees in the executive branch as 
        the governor deems necessary to minimize the impact of the 
        disaster or emergency, conforming the alterations or adjustments 
        to existing state laws, rules, and collective bargaining 
        agreements to the extent practicable; 
           (11) authorize the commissioner of children, families, and 
        learning to alter school schedules, curtail school activities, 
        or order schools closed without affecting state aid to schools, 
        as defined in section 120.05, and including charter schools 
        under section 120.064, and elementary schools enrolling 
        prekindergarten pupils in district programs.  
           Sec. 2.  Minnesota Statutes 1996, section 120.0111, is 
        amended to read: 
           120.0111 [MISSION STATEMENT.] 
           The mission of public education in Minnesota, a system for 
        lifelong learning, is to ensure individual academic achievement, 
        an informed citizenry, and a highly productive work force.  This 
        system focuses on the learner, promotes and values diversity, 
        provides participatory decision-making, ensures accountability, 
        models democratic principles, creates and sustains a climate for 
        change, provides personalized learning environments, encourages 
        learners to reach their maximum potential, and integrates and 
        coordinates human services for learners.  The public schools of 
        this state shall serve the needs of the students by cooperating 
        with the students' parents and legal guardians to develop the 
        students' intellectual capabilities and life-work skills in a 
        safe and positive environment.  It is part of the department's 
        mission that within the department's resources the commissioner 
        shall endeavor to: 
           (1) prevent the waste or unnecessary spending of public 
        money; 
           (2) use innovative fiscal and human resource practices to 
        manage the state's resources and operate the department as 
        efficiently as possible; 
           (3) coordinate the department's activities wherever 
        appropriate with the activities of other governmental agencies; 
           (4) use technology where appropriate to increase agency 
        productivity, improve customer service, increase public access 
        to information about government, and increase public 
        participation in the business of government; 
           (5) utilize constructive and cooperative labor-management 
        practices to the extent otherwise required by chapters 43A and 
        179A; 
           (6) include specific objectives in the performance report 
        required under section 15.91 to increase the efficiency of 
        agency operations, when appropriate; and 
           (7) recommend to the legislature, in the performance report 
        of the department required under section 15.91, appropriate 
        changes in law necessary to carry out the mission of the 
        department. 
           Sec. 3.  Minnesota Statutes 1996, section 120.101, 
        subdivision 5c, is amended to read: 
           Subd. 5c.  [EDUCATION RECORDS.] (a) A school district from 
        which a student is transferring must transmit the student's 
        educational records, within ten business days of a request, to 
        the school district in which the student is enrolling.  School 
        districts must make reasonable efforts to determine the school 
        district in which a transferring student is next enrolling in 
        order to comply with this subdivision. 
           (b) A school district that transmits a student's 
        educational records to another school district or other 
        educational entity to which the student is transferring must 
        include in the transmitted records information about 
        disciplinary action taken as a result of any incident in which 
        the student possessed or used a dangerous weapon. 
           Sec. 4.  Minnesota Statutes 1996, section 123.35, is 
        amended by adding a subdivision to read: 
           Subd. 19c.  [JOINTLY OWNED FACILITIES.] Notwithstanding 
        section 123.35, subdivision 19a, if a school district and a city 
        jointly own a building or site, the district and the city may 
        enter into an agreement that extends beyond the end of the 
        fiscal year to pay operating costs for that building or site. 
           Sec. 5.  Minnesota Statutes 1996, section 123.3514, 
        subdivision 4c, is amended to read: 
           Subd. 4c.  [LIMIT ON PARTICIPATION.] A pupil who first 
        enrolls in grade 11 may not enroll in post-secondary courses 
        under this section for secondary credit for more than the 
        equivalent of two academic years.  A pupil who first enrolls in 
        grade 12 may not enroll in post-secondary courses under this 
        section for secondary credit for more than the equivalent of one 
        academic year.  If a pupil in grade 11 or 12 first enrolls in a 
        post-secondary course for secondary credit during the school 
        year, the time of participation shall be reduced 
        proportionately.  If a pupil is in a learning year or other 
        year-round program and begins each grade in the summer session, 
        summer sessions shall not be counted against the time of 
        participation.  A pupil who has graduated from high school 
        cannot participate in a program under this section.  A pupil who 
        has completed course requirements for graduation but who has not 
        received a diploma may participate in the program under this 
        section. 
           Sec. 6.  Minnesota Statutes 1996, section 123.3514, 
        subdivision 8, is amended to read: 
           Subd. 8.  [TRANSPORTATION.] A parent or guardian of a pupil 
        enrolled in a course for secondary credit may apply to the 
        pupil's district of residence for reimbursement for transporting 
        the pupil between the secondary school in which the pupil is 
        enrolled or the pupil's home and the post-secondary institution 
        that the pupil attends.  The commissioner shall establish 
        guidelines for providing state aid to districts to The state 
        shall provide state aid to a district in an amount sufficient to 
        reimburse the parent or guardian for the necessary 
        transportation costs, which shall be based on financial 
        need when the family's or guardian's income is at or below the 
        poverty level, as determined by the federal government.  The 
        reimbursement may not exceed shall be the pupil's actual cost of 
        transportation or 15 cents per mile traveled, whichever is 
        less.  Reimbursement may not be paid for more than 250 miles per 
        week.  However, if the nearest post-secondary institution is 
        more than 25 miles from the pupil's resident secondary school, 
        the weekly reimbursement may not exceed the reimbursement rate 
        per mile times the actual distance between the secondary school 
        or the pupil's home and the nearest post-secondary institution 
        times ten.  The state shall pay aid to the district according to 
        the guidelines established under this subdivision.  Chapter 14 
        does not apply to the guidelines. 
           Sec. 7.  Minnesota Statutes 1996, section 124C.498, 
        subdivision 2, is amended to read: 
           Subd. 2.  [APPROVAL AUTHORITY; APPLICATION FORMS.] To the 
        extent money is available, the commissioner of children, 
        families, and learning may approve projects from applications 
        submitted under this section.  The grant money must be used only 
        to design, acquire, construct, remodel, improve, furnish, or 
        equip the building or site of a magnet school facility according 
        to contracts entered into within 15 24 months after the date on 
        which a grant is awarded. 
           Sec. 8.  Minnesota Statutes 1996, section 125.12, 
        subdivision 14, is amended to read: 
           Subd. 14.  [RECORDS RELATING TO INDIVIDUAL TEACHER; ACCESS; 
        EXPUNGEMENT.] All evaluations and files generated within a 
        school district relating to each individual teacher shall be 
        available to each individual teacher upon written request.  
        Effective January 1, 1976, all evaluations and files, wherever 
        generated, relating to each individual teacher shall be 
        available to each individual teacher upon written request.  The 
        teacher shall have the right to reproduce any of the contents of 
        the files at the teacher's expense and to submit for inclusion 
        in the file written information in response to any material 
        contained therein. 
           A school district may destroy the files as provided by law 
        and shall expunge from the teacher's file any material found to 
        be false or substantially inaccurate through the grievance 
        procedure required pursuant to section 179A.20, subdivision 4; 
        provided, the grievance procedure promulgated by the director of 
        the bureau of mediation services, pursuant to section 179A.04, 
        subdivision 3, clause (h), shall apply to those principals and 
        supervisory employees not included in an appropriate unit as 
        defined in section 179A.03.  Expungement proceedings shall be 
        commenced within the time period provided in the collective 
        bargaining agreement for the commencement of a grievance.  If no 
        time period is provided in the bargaining agreement, the 
        expungement proceedings shall commence within 15 days after the 
        teacher has knowledge of the inclusion in the teacher's file of 
        the material the teacher seeks to have expunged.  
           Sec. 9.  Minnesota Statutes 1996, section 126.77, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [VIOLENCE PREVENTION CURRICULUM.] (a) The 
        commissioner of children, families, and learning, in 
        consultation with the commissioners of health and human 
        services, state minority councils, battered women's programs, 
        sexual assault centers, representatives of religious 
        communities, and the assistant commissioner of the office of 
        drug policy and violence prevention, shall assist districts on 
        request in developing or implementing a violence prevention 
        program for students in kindergarten to grade 12 that can be 
        integrated into existing curriculum.  The purpose of the program 
        is to help students learn how to resolve conflicts within their 
        families and communities in nonviolent, effective ways.  
           (b) Each district is encouraged to integrate into its 
        existing curriculum a program for violence prevention that 
        includes at least: 
           (1) a comprehensive, accurate, and age appropriate 
        curriculum on violence prevention, nonviolent conflict 
        resolution, and sexual, racial, and cultural harassment, and 
        student hazing that promotes equality, respect, understanding, 
        effective communication, individual responsibility, thoughtful 
        decision making, positive conflict resolution, useful coping 
        skills, critical thinking, listening and watching skills, and 
        personal safety; 
           (2) planning materials, guidelines, and other accurate 
        information on preventing physical and emotional violence, 
        identifying and reducing the incidence of sexual, racial, and 
        cultural harassment, and reducing child abuse and neglect; 
           (3) a special parent education component of early childhood 
        family education programs to prevent child abuse and neglect and 
        to promote positive parenting skills, giving priority to 
        services and outreach programs for at-risk families; 
           (4) involvement of parents and other community members, 
        including the clergy, business representatives, civic leaders, 
        local elected officials, law enforcement officials, and the 
        county attorney; 
           (5) collaboration with local community services, agencies, 
        and organizations that assist in violence intervention or 
        prevention, including family-based services, crisis services, 
        life management skills services, case coordination services, 
        mental health services, and early intervention services; 
           (6) collaboration among districts and SCs; 
           (7) targeting early adolescents for prevention efforts, 
        especially early adolescents whose personal circumstances may 
        lead to violent or harassing behavior; 
           (8) opportunities for teachers to receive in-service 
        training or attend other programs on strategies or curriculum 
        designed to assist students in intervening in or preventing 
        violence in school and at home; and 
           (9) administrative policies that reflect, and a staff that 
        models, nonviolent behaviors that do not display or condone 
        sexual, racial, or cultural harassment or student hazing. 
           (c) The department may provide assistance at a neutral site 
        to a nonpublic school participating in a district's program. 
           Sec. 10.  Minnesota Statutes 1996, section 127.26, is 
        amended to read: 
           127.26 [CITATION.] 
           Sections 127.26 to 127.39 may be cited as "The pupil fair 
        dismissal act of 1974."  
           Sec. 11.  Minnesota Statutes 1996, section 127.27, 
        subdivision 5, is amended to read: 
           Subd. 5.  [EXPULSION.] "Expulsion" means an action taken by 
        a school board action to prohibit an enrolled pupil from further 
        attendance for a period that shall not extend beyond an amount 
        of time equal up to one school year 12 months from the date a 
        the pupil is expelled. 
           Sec. 12.  Minnesota Statutes 1996, section 127.27, 
        subdivision 6, is amended to read: 
           Subd. 6.  [PARENT.] "Parent" means (a) one of the pupil's 
        parents, or (b) in the case of divorce or legal separation, or 
        if the child's mother was not married to the child's father when 
        the child was conceived nor when the child was born, the 
        custodial parent the parent or parents with physical custody of 
        the pupil, including a noncustodial parent with legal custody 
        who has provided the district with a current address and 
        telephone number, or (c) a legally appointed guardian.  In the 
        case of a pupil with a disability under the age of 18, parent 
        may include a district-appointed surrogate parent. 
           Sec. 13.  Minnesota Statutes 1996, section 127.27, 
        subdivision 7, is amended to read: 
           Subd. 7.  [PUPIL.] "Pupil" means any student with or: 
           (1) without a disability under 21 years of age; or 
           (2) with a disability until September 1 after the child 
        with a disability becomes 22 years of age; 
           (3) and who remains eligible to attend a public elementary 
        or secondary school. 
           Sec. 14.  Minnesota Statutes 1996, section 127.27, 
        subdivision 8, is amended to read: 
           Subd. 8.  [SCHOOL.] "School" means any school as defined in 
        Minnesota Statutes 1971, section 120.05, subdivision 2. 
           Sec. 15.  Minnesota Statutes 1996, section 127.27, 
        subdivision 10, is amended to read: 
           Subd. 10.  [SUSPENSION.] "Suspension" means an action taken 
        by the school administration, under rules promulgated by the 
        school board, prohibiting a pupil from attending school for a 
        period of no more than ten school days.  If a suspension is 
        longer than five days, the suspending administrator must provide 
        the superintendent with a reason for the longer suspension.  
        This definition does not apply to dismissal from school for one 
        school day or less.  Each suspension action shall include a 
        readmission plan.  The readmission plan shall include, where 
        appropriate, a provision for implementing alternative programs 
        to be implemented educational services upon readmission.  
        Suspension may not be consecutively imposed The school 
        administration may not impose consecutive suspensions against 
        the same pupil for the same course of conduct, or incident of 
        misconduct, except where the pupil will create an immediate and 
        substantial danger to self or to surrounding persons or 
        property, or where the district is in the process of initiating 
        an expulsion, in which case the school administration may extend 
        the suspension up to 15 days.  In no event shall suspension 
        exceed 15 school days, provided that an In the case of a pupil 
        with a disability, a suspension may not exceed ten school days.  
        The school administration shall implement alternative program 
        shall be implemented educational services to the extent that 
        suspension exceeds five days.  A separate administrative 
        conference is required for each period of suspension. 
           Sec. 16.  Minnesota Statutes 1996, section 127.27, is 
        amended by adding a subdivision to read: 
           Subd. 11.  [ALTERNATIVE EDUCATIONAL SERVICES.] "Alternative 
        educational services" may include, but are not limited to, 
        special tutoring, modified curriculum, modified instruction, 
        other modifications or adaptations, special education services 
        as indicated by appropriate assessment, homebound instruction, 
        or enrollment in another district or in an alternative learning 
        center under section 124C.45. 
           Sec. 17.  Minnesota Statutes 1996, section 127.281, is 
        amended to read: 
           127.281 [EXCLUSION AND EXPULSION OF PUPILS WITH A 
        DISABILITY.] 
           When a pupil who has an individual education plan is 
        excluded or expelled under sections 127.26 to 127.39 for 
        misbehavior that is not a manifestation of the pupil's disabling 
        condition disability, the district shall continue to provide 
        special education and related services after a period of 
        suspension, if suspension is imposed.  The district shall 
        initiate a review of the pupil's individual education plan 
        within ten five school days of the commencement of commencing an 
        expulsion, exclusion, or a suspension of ten days or more.  
           Sec. 18.  Minnesota Statutes 1996, section 127.29, is 
        amended to read: 
           127.29 [GROUNDS FOR DISMISSAL.] 
           Subdivision 1.  No school shall dismiss any pupil without 
        attempting to provide alternative programs of education prior to 
        dismissal educational services before dismissal proceedings, 
        except where it appears that the pupil will create an immediate 
        and substantial danger to self or to surrounding persons or 
        property.  Such programs may include special tutoring, 
        modification of the curriculum for the pupil, placement in a 
        special class or assistance from other agencies. 
           Subd. 2.  A pupil may be dismissed on any of the following 
        grounds: 
           (a) willful violation of any reasonable school board 
        regulation.  Such regulation must be clear and definite to 
        provide notice to pupils that they must conform their conduct to 
        its requirements; 
           (b) willful conduct which that materially and substantially 
        disrupts the rights of others to an education; or 
           (c) willful conduct which that endangers the pupil or other 
        pupils, or the surrounding persons, or property of the school. 
           Sec. 19.  Minnesota Statutes 1996, section 127.30, 
        subdivision 1, is amended to read: 
           Subdivision 1.  No suspension The school administration 
        shall not suspend a pupil from school shall be imposed without 
        an informal administrative conference with the pupil, except.  
        The informal administrative conference shall take place before 
        the suspension, except where it appears that the pupil will 
        create an immediate and substantial danger to self or to 
        surrounding persons or property, in which case the conference 
        shall take place as soon as practicable following the suspension.
           Sec. 20.  Minnesota Statutes 1996, section 127.30, is 
        amended by adding a subdivision to read: 
           Subd. 1a.  At the informal administrative conference, a 
        school administrator shall notify the pupil of the grounds for 
        the suspension, provide an explanation of the evidence the 
        authorities have, and the pupil may present the pupil's version 
        of the facts. 
           Sec. 21.  Minnesota Statutes 1996, section 127.30, 
        subdivision 2, is amended to read: 
           Subd. 2.  A written notice containing the grounds for 
        suspension, a brief statement of the facts, a description of the 
        testimony, a readmission plan, and a copy of sections 127.26 to 
        127.39, shall be personally served upon the pupil at or before 
        the time the suspension is to take effect, and upon the pupil's 
        parent or guardian by certified mail within 48 hours of the 
        conference.  The district shall make reasonable efforts to 
        notify the parents of the suspension by telephone as soon as 
        possible following suspension.  In the event a pupil is 
        suspended without an informal administrative conference on the 
        grounds that the pupil will create an immediate and substantial 
        danger to surrounding persons or property, the written notice 
        shall be served either personally or by certified mail upon the 
        pupil and the pupil's parent or guardian within 48 hours of the 
        suspension.  Service by certified mail is complete upon mailing. 
           Sec. 22.  Minnesota Statutes 1996, section 127.30, 
        subdivision 3, is amended to read: 
           Subd. 3.  Notwithstanding the provisions of subdivisions 1 
        and 2, the pupil may be suspended pending the school board's 
        decision in the expulsion or exclusion hearing; provided that an 
        alternative program shall be educational services are 
        implemented to the extent that suspension exceeds five days. 
           Sec. 23.  Minnesota Statutes 1996, section 127.31, 
        subdivision 2, is amended to read: 
           Subd. 2.  Written notice of intent to take action shall: 
           (a) be served upon the pupil and the pupil's parent or 
        guardian personally or by certified mail; 
           (b) contain a complete statement of the facts, a list of 
        the witnesses and a description of their testimony; 
           (c) state the date, time, and place of the hearing; 
           (d) be accompanied by a copy of sections 127.26 to 127.39; 
           (e) describe alternative educational programs services 
        accorded the pupil prior to commencement of in an attempt to 
        avoid the expulsion or exclusion proceedings; and 
           (f) inform the pupil and parent or guardian of the right to:
           (1) have a representative of the pupil's own choosing, 
        including legal counsel, at the hearing.  The district shall 
        advise the pupil's parent or guardian that free or low-cost 
        legal assistance may be available and that a legal assistance 
        resource list is available from the department of children, 
        families, and learning; 
           (2) examine the pupil's records before the hearing; 
           (3) present evidence; and 
           (4) confront and cross-examine witnesses.  
           Sec. 24.  Minnesota Statutes 1996, section 127.31, 
        subdivision 7, is amended to read: 
           Subd. 7.  The hearing shall take place before: 
           (a) (1) an independent hearing officer; 
           (b) (2) a member of the school board; 
           (c) (3) a committee of the school board,; or; 
           (d) (4) the full school board; 
        as determined by the school board.  The hearing shall be 
        conducted in a fair and impartial manner. 
           Sec. 25.  Minnesota Statutes 1996, section 127.31, 
        subdivision 8, is amended to read: 
           Subd. 8.  The proceedings of the hearing shall be recorded 
        and preserved, at the expense of the school district, pending 
        ultimate disposition of the action.  The school board shall 
        record the hearing proceedings at district expense, and a party 
        may obtain a transcript at its own expense.  Testimony shall be 
        given under oath.  The hearing officer or a member of the school 
        board shall have the power to issue subpoenas and administer 
        oaths.  
           Sec. 26.  Minnesota Statutes 1996, section 127.31, 
        subdivision 13, is amended to read: 
           Subd. 13.  The recommendation of the hearing officer or 
        school board member or committee shall be based solely upon 
        substantial evidence presented at the hearing and must be made 
        to the school board and served upon the parties within two days 
        of the end of the hearing.  
           Sec. 27.  Minnesota Statutes 1996, section 127.31, 
        subdivision 14, is amended to read: 
           Subd. 14.  The decision by The school board shall be based 
        base its decision upon the recommendation of the hearing officer 
        or school board member or committee and shall be rendered render 
        its decision at a special meeting held within five days after 
        receipt of receiving the recommendation.  The school board may 
        provide the parties with the opportunity to present exceptions 
        and comments to the hearing officer's recommendations provided 
        that neither party presents any evidence not admitted at the 
        hearing.  The decision shall by the school board must be based 
        on the record, must be in writing, and must state the 
        controlling facts found upon on which the decision is made shall 
        be stated in sufficient detail to apprise the parties and the 
        commissioner of children, families, and learning of the basis 
        and reason for the decision. 
           Sec. 28.  Minnesota Statutes 1996, section 127.31, 
        subdivision 15, is amended to read: 
           Subd. 15.  [ADMISSION OR READMISSION PLAN.] A school board 
        may administrator shall prepare and enforce an admission or 
        readmission plan for any pupil who is suspended, excluded, or 
        expelled from school.  The plan may include measures to improve 
        the pupil's behavior and require parental involvement in the 
        admission or readmission process, and may indicate the 
        consequences to the pupil of not improving the pupil's behavior. 
           Sec. 29.  Minnesota Statutes 1996, section 127.311, is 
        amended to read: 
           127.311 [GOOD FAITH EXCEPTION.] 
           A violation of the technical provisions of the pupil fair 
        dismissal act of 1974, made in good faith, is not a defense to a 
        disciplinary procedure under the act unless the pupil can 
        demonstrate actual prejudice as a result of the violation. 
           Sec. 30.  Minnesota Statutes 1996, section 127.32, is 
        amended to read: 
           127.32 [APPEAL.] 
           A party to an exclusion or expulsion decision made pursuant 
        to under sections 127.26 to 127.39 may be appealed appeal the 
        decision to the commissioner of children, families, and learning 
        within 21 calendar days of school board action.  Upon being 
        served with a notice of appeal, the district shall provide the 
        commissioner and the parent or guardian with a complete copy of 
        the hearing record within five days of its receipt of the notice 
        of appeal.  All written submissions by the appellant must be 
        submitted and served on the respondent within ten days of its 
        actual receipt of the transcript.  All written submissions by 
        the respondent must be submitted and served on the appellant 
        within ten days of its actual receipt of the written submissions 
        of the appellant. 
           In an appeal under this section, the commissioner may 
        affirm the decision of the agency or may reverse or modify the 
        decision if the substantial rights of the petitioners may have 
        been prejudiced because the administrative findings, inferences, 
        conclusions, or decisions are: 
           (1) in violation of constitutional provisions; 
           (2) in excess of the statutory authority or jurisdiction of 
        the school district; 
           (3) made upon unlawful procedure, except as provided in 
        section 127.311; 
           (4) affected by other error of law; 
           (5) unsupported by substantial evidence in view of the 
        entire record submitted; or 
           (6) arbitrary or capricious. 
        The commissioner or the commissioner's representative shall make 
        a final decision based upon a the record of evidence presented 
        at the hearing.  Such ruling shall be binding upon the parties, 
        subject to judicial review as provided in section 127.33.  The 
        commissioner shall issue a decision within 30 calendar days of 
        receiving the entire record and the parties' written submission 
        on appeal.  The commissioner's decision shall be final and 
        binding upon the parties after the time for appeal expires under 
        section 127.33. 
           Sec. 31.  Minnesota Statutes 1996, section 127.33, is 
        amended to read: 
           127.33 [JUDICIAL REVIEW.] 
           The decision of the commissioner of children, families, and 
        learning made pursuant to under sections 127.26 to 127.39 shall 
        be is subject to judicial review in accordance with chapter 14 
        under sections 14.63 to 14.69.  The decision of the commissioner 
        is stayed pending an appeal under this section. 
           Sec. 32.  Minnesota Statutes 1996, section 127.36, is 
        amended to read: 
           127.36 [REPORT TO COMMISSIONER OF CHILDREN, FAMILIES, AND 
        LEARNING.] 
           Subdivision 1.  [EXCLUSIONS AND EXPULSIONS.] The school 
        board shall report each exclusion or expulsion within 30 days of 
        the effective date of the action to the commissioner of 
        children, families, and learning.  This report shall include a 
        statement of alternative programs of education accorded 
        educational services given the pupil prior to the commencement 
        of before beginning exclusion or expulsion proceedings, and the 
        reason for, the effective date, and the duration of the 
        exclusion or expulsion.  
           Subd. 2.  [REPORT.] The school board must include state 
        student identification numbers of affected pupils on all 
        dismissal reports required by the department.  The department 
        must report annually to the commissioner summary data on the 
        number of dismissals by age, grade, gender, race, and special 
        education status of the affected pupils. 
           Sec. 33.  Minnesota Statutes 1996, section 127.37, is 
        amended to read: 
           127.37 [NOTICE OF RIGHT TO BE REINSTATED.] 
           Whenever a pupil fails to return to school within ten 
        school days of the termination of dismissal, a school 
        administrator shall inform the pupil and the pupil's 
        parents shall be informed by certified mail of the pupil's right 
        to attend and to be reinstated in the public school.  
           Sec. 34.  Minnesota Statutes 1996, section 127.38, is 
        amended to read: 
           127.38 [POLICIES TO BE ESTABLISHED.] 
           (a) The commissioner of children, families, and learning 
        shall promulgate guidelines to assist each school board.  Each 
        school board shall establish uniform criteria for dismissal and 
        adopt written policies and rules in writing to effectuate the 
        purposes of sections 127.26 to 127.39.  The policies will shall 
        emphasize the prevention of dismissal action preventing 
        dismissals through early detection of problems.  The policies 
        shall recognize the continuing responsibility of the school for 
        the education of the pupil during the dismissal period.  The 
        alternative educational services, if the pupil wishes to take 
        advantage of them, must be adequate to allow the pupil to make 
        progress towards meeting the graduation standards adopted under 
        section 121.11, subdivision 7c, and help prepare the pupil for 
        readmission.  
           (b) An area learning center under section 124C.45 may not 
        prohibit an expelled or excluded pupil from enrolling solely 
        because a district expelled or excluded the pupil.  The board of 
        the area learning center may use the provisions of the Pupil 
        Fair Dismissal Act to exclude a pupil or to require an admission 
        plan. 
           (c) The commissioner shall actively encourage and assist 
        school districts to cooperatively establish alternative learning 
        programs educational services that offer instruction to pupils 
        who are dismissed from school for willfully engaging in 
        dangerous, disruptive, or violent behavior, including for 
        possessing a firearm in a school zone. 
           Sec. 35.  [127.465] [HAZING POLICY.] 
           Subdivision 1.  [DEFINITIONS.] (a) "Hazing" means 
        committing an act against a student, or coercing a student into 
        committing an act, that creates a substantial risk of harm to a 
        person in order for the student to be initiated into or 
        affiliated with a student organization. 
           (b) "Student organization" means a group, club, or 
        organization having students as its primary members or 
        participants. 
           Subd. 2.  [MODEL POLICY.] The commissioner of children, 
        families, and learning shall maintain and make available to 
        school boards a model policy on student or staff hazing that 
        addresses the requirements of subdivision 3.  
           Subd. 3.  [SCHOOL BOARD POLICY.] Each school board shall 
        adopt a written policy governing student or staff hazing.  The 
        policy must apply to student behavior that occurs on or off 
        school property and during and after school hours.  The policy 
        must include reporting procedures and disciplinary consequences 
        for violating the policy.  Disciplinary consequences must be 
        sufficiently severe to deter violations and appropriately 
        discipline prohibited behavior.  Disciplinary consequences must 
        conform with sections 127.27 to 127.39.  Each school must 
        include the policy in the student handbook on school policies. 
           Sec. 36.  Minnesota Statutes 1996, section 128C.02, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SEXUAL HARASSMENT AND VIOLENCE; HAZING.] The 
        board of the league shall adopt a policy, rules, penalties, and 
        recommendations addressing sexual harassment and sexual violence 
        and hazing toward and by participants in league activities. 
           Sec. 37.  Minnesota Statutes 1996, section 128C.02, is 
        amended by adding a subdivision to read: 
           Subd. 8.  [BUDGET.] The league is subject to the 
        commissioner of finance's rules and instructions governing 
        budget preparation.  The league budget must be submitted to the 
        commissioner of finance and to the legislature in the same 
        manner as budgets of executive branch agencies. 
           Sec. 38.  Minnesota Statutes 1996, section 128C.12, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DUES AND EVENTS REVENUE.] The state 
        auditor annually must examine the accounts of, and audit all 
        money paid to, the state high school league by its members.  The 
        audit must include financial and compliance issues.  The state 
        auditor must also audit all money derived from any event 
        sponsored by the league and review any private audits done for 
        the league.  League audits must include audits of administrative 
        regions of the league.  The league and its administrative 
        regions may not contract with private auditors.  The scope of 
        the state auditor's examinations of the league must be agreed 
        upon by the board and the state auditor, provided that all 
        requirements of this section must be met. 
           Sec. 39.  [128C.13] [INVESTMENT.] 
           The governing board of the league may request the state 
        board of investment to invest nonretirement funds of the league, 
        and the state board of investment may invest these funds when 
        requested. 
           Sec. 40.  [135A.081] [REMEDIAL INSTRUCTION; HIGH SCHOOL 
        DIPLOMA WARRANTY.] 
           Subdivision 1.  [CONDITIONS.] A public post-secondary 
        institution may provide remedial instruction if within 12 months 
        of first enrollment, the institution determines that the 
        student's English language reading or writing ability, or the 
        student's mathematic ability does not rise to the level that is 
        a necessary prerequisite to minimally acceptable comprehension 
        of entry level courses or programs at the institution. 
           Subd. 2.  [CONFIRMATION.] The institution's determination 
        of a student's substandard ability is confirmed if the student 
        scores below 12th grade level in a standardized test in any of 
        the following areas covered by the determination:  English 
        language reading comprehension, English language composition, or 
        mathematics. 
           Subd. 3.  [HIGH SCHOOL DIPLOMA WARRANTY COVERAGE.] (a) If a 
        student who graduated from a public high school scores below the 
        8th grade level on a confirming test, the student's high school 
        shall pay the tuition for the student for all remedial courses 
        in the area covered by the confirming test that the student 
        takes in the first year after the student's graduation from high 
        school.  The student's high school shall pay one-half of the 
        tuition for the student for all remedial courses in the area 
        covered by the confirming test that the student takes in the 
        second year after the student's graduation from high school.  
        This subdivision shall apply to students graduating from a 
        public high school on or after May 1, 1999. 
           (b) The payment of tuition by the public high school shall 
        be waived if the high school can demonstrate, through the 
        results of a standardized test, that the student had attained 
        8th grade level performance in the area covered by the 
        confirming test prior to graduation. 
           Subd. 4.  [NO CREDITS; STUDENT COSTS.] A post-secondary 
        institution providing remedial instruction under this section 
        must not award credit to a student toward a degree or program 
        completion for remedial instruction provided under this section. 
           Subd. 5.  [JUST CLAIM.] A request for payment for remedial 
        instruction to a student under this section is, under section 
        123.40, subdivision 1, a just claim against the school district 
        that includes the student's high school. 
           Sec. 41.  [135A.155] [HAZING POLICY.] 
           The board of trustees of the Minnesota state colleges and 
        universities shall, and the University of Minnesota is requested 
        to, adopt a clear, understandable written policy on student 
        conduct, including hazing.  The policy must include procedures 
        for reporting incidents of inappropriate hazing and for 
        disciplinary actions against individual violators and 
        organizations.  The policy must be provided to students when 
        they register and must be posted at appropriate locations on 
        campus.  A private post-secondary institution that is an 
        eligible institution as defined in section 136A.101, subdivision 
        4, must adopt a policy that meets the requirements of this 
        section. 
           Sec. 42.  Minnesota Statutes 1996, section 245.91, 
        subdivision 2, is amended to read: 
           Subd. 2.  [AGENCY.] "Agency" means the divisions, 
        officials, or employees of the state departments of human 
        services and, health, children, families, and learning, and of 
        local school districts and designated county social service 
        agencies as defined in section 256G.02, subdivision 7, that are 
        engaged in monitoring, providing, or regulating services or 
        treatment for mental illness, mental retardation or a related 
        condition, chemical dependency, or emotional disturbance. 
           Sec. 43.  [PROTECTIVE SOFTWARE.] 
           Subdivision 1.  [SOFTWARE RECOMMENDATIONS.] The 
        commissioner of children, families, and learning shall research, 
        evaluate, and make recommendations to school districts on 
        computer software products that filter, block, or otherwise 
        prevent the use of school computers for the transmission of any 
        comment, request, suggestion, proposal, image, or other 
        communication which is: 
           (1) obscene, indecent, or sexually explicit; or 
           (2) intended to promote or incite violence against other 
        living persons. 
           Subd. 2.  [SCHOOL DISTRICTS.] Within one year of the 
        commissioner completing the requirements of subdivision 1, each 
        school district must adopt a policy on Internet usage. 
           Sec. 44.  [CONSULTATION.] 
           The commissioner of children, families, and learning shall 
        consult with the Minnesota school board association in preparing 
        the model hazing policy under Minnesota Statutes, section 
        127.465. 
           Sec. 45.  [CLASS SIZE PROJECT.] 
           A class size project is established in independent school 
        district No. 12, Centennial.  The purpose of this project is to 
        establish that significantly lower class size and 
        instructor-to-learner ratios in a suburban community will result 
        in measurable achievements for students, staff, and parents. 
           Sec. 46.  [INSTRUCTIONAL DAY CLARIFICATION.] 
           (a) This section applies to any school district employee 
        who was scheduled to work on January 16, 1997, did not work on 
        that day, and did not receive compensation for that day. 
           (b) Notwithstanding any law to the contrary, a school 
        district must either:  (1) allow any school district employee 
        under paragraph (a) the opportunity to work on another day that 
        the school district designates and must compensate the employee 
        working on the designated day at the employee's normal rate of 
        pay; or (2) compensate any school district employee under 
        paragraph (a) for that day at the employee's normal rate of pay. 
           Sec. 47.  [PARTNERS FOR QUALITY SCHOOL IMPROVEMENT PILOT 
        TRAINING PROGRAM.] 
           Subdivision 1.  [ESTABLISHMENT.] The school improvement 
        training and performance pilot program is established to 
        accelerate school quality and performance improvement 
        initiatives that lead to improved student achievement in both 
        high-performing and under-performing schools. 
           Subd. 2.  [ELIGIBILITY.] A school district is eligible to 
        apply for a grant to establish one or more school improvement 
        training and performance sites.  The application and selection 
        process must be developed and implemented by the Minnesota 
        academic excellence foundation and reviewed by the commissioner 
        of children, families, and learning.  Priority for participation 
        must be given to school districts in which: 
           (1) the district has received an educational performance 
        improvement grant under Laws 1994, chapter 647, article 7, 
        section 18, and has demonstrated improvement in student learning 
        as a result of the grant; 
           (2) one school or the district has completed training in a 
        statewide quality improvement initiative; 
           (3) the district has demonstrated accountability by 
        developing and communicating an agenda to increase student 
        learning; 
           (4) there are significant numbers of students with critical 
        learning needs and gaps in learning between these students and 
        other groups of students; and 
           (5) site-based management is being implemented. 
           Subd. 3.  [PROGRAM SERVICES.] The Minnesota academic 
        excellence foundation must provide training and technical 
        assistance to selected districts to: 
           (1) create plans for the districtwide deployment of quality 
        improvement training to all staff; 
           (2) create a means for identifying and providing remedial, 
        interventive, or preventive assistance to schools in the 
        district, based upon the schools' performances against state and 
        local goals and standards; 
           (3) accelerate school performance and student learning in 
        high-performing and under-performing schools; and 
           (4) train quality program trainers at each site. 
           Subd. 4.  [SCHOOL DISTRICT PARTICIPANTS.] Selected 
        districts must enter into a contract to achieve increases in 
        student learning, staff development and performance, and 
        administrative support services to schools within the district.  
        Additionally, each selected district must: 
           (1) plan and deploy quality improvement and other training 
        to all staff in the district; 
           (2) establish quality and performance goals and measure 
        results and report the achieved results at the selected school 
        sites; and 
           (3) assist in duplicating successful programs in other 
        districts by providing training to other school districts for a 
        period of up to four years, in collaboration with the Minnesota 
        academic excellence foundation. 
           Subd. 5.  [REPORT.] The Minnesota academic excellence 
        foundation must report to the commissioner of children, 
        families, and learning on the progress of the project and 
        annually on the results of the project. 
           Sec. 48.  [GRANT PROGRAM FOR VIOLENCE PREVENTION THROUGH 
        THE DEVELOPMENT OF PLAYS, WORKSHOPS, AND EDUCATIONAL RESOURCES.] 
           Subdivision 1.  [GRANT PROGRAM.] The commissioner shall 
        administer a grant program to fund statewide programs to create 
        and develop theatrical plays, workshops, and educational 
        resources based on peer education models that promote increased 
        awareness and prevention of sexual abuse, interpersonal 
        violence, emotional violence, and sexual harassment.  Programs 
        eligible for grants must use a combination of theater 
        professionals and prevention specialists in the delivery of the 
        service and use a peer education model that uses researched and 
        proven content in training youth to perform in the plays and 
        workshops.  Programs must provide the source material, the 
        training program, develop the educational materials, and provide 
        technical assistance. 
           Subd. 2.  [GRANT PROCEDURE.] Programs may apply for a grant 
        by submitting an application to the commissioner.  The 
        commissioner may distribute grants to one or more programs 
        meeting the criteria described in subdivision 1. 
           Sec. 49.  [EXEMPTION TO LABOR DAY SCHOOL START 
        RESTRICTION.] 
           Subdivision 1.  [1998-1999 AND 1999-2000 SCHOOL 
        YEARS.] Notwithstanding Minnesota Statutes, section 126.12, 
        subdivision 1, for the 1998-1999 and 1999-2000 school years 
        only, a school board may begin the elementary or secondary 
        school year on the Wednesday, Thursday, or Friday prior to Labor 
        Day. 
           Subd. 2.  [COLUMBIA HEIGHTS.] Notwithstanding Minnesota 
        Statutes, section 126.12, subdivision 1, independent school 
        district No. 13, Columbia Heights, may begin the school year 
        before Labor Day only by the number of days necessary to 
        accommodate the district building construction and remodeling 
        project. 
           Subd. 3.  [CROOKSTON.] Notwithstanding Minnesota Statutes, 
        section 126.12, subdivision 1, independent school district No. 
        593, Crookston, may begin the 1997-1998 school year the 
        Wednesday before Labor Day to accommodate the transition into 
        the new high school and the renovated junior high school 
        building. 
           Subd. 4.  [GRAND RAPIDS.] Notwithstanding Minnesota 
        Statutes, section 126.12, subdivision 1, independent school 
        district No. 318, Grand Rapids, may begin the 1997-1998 school 
        year before Labor Day only by the number of days necessary to 
        accommodate the district building construction project. 
           Subd. 5.  [ISLE.] Notwithstanding Minnesota Statutes, 
        section 126.12, subdivision 1, for the 1997-1998 school year, 
        independent school district No. 473, Isle, may begin the 
        elementary and secondary school year on August 18, 1997, in 
        order for the school district to complete its conversion of an 
        existing elementary school to a K-12 facility before the 
        beginning of the 1998-1999 school year. 
           Subd. 6.  [LAKE PARK; AUDUBON.] Notwithstanding Minnesota 
        Statutes, section 126.12, subdivision 1, for the 1997-1998 
        school year, independent school district Nos. 24, Lake Park, and 
        21, Audubon, may begin the elementary and secondary school year 
        on August 25, 1997, in order for independent school district No. 
        24, Lake Park, to accommodate its building renovation schedule 
        at the end of that school year. 
           Subd. 7.  [NEW PRAGUE.] Notwithstanding Minnesota Statutes, 
        section 126.12, subdivision 1, independent school district No. 
        721, New Prague, may begin the 1997-1998 school year prior to 
        Labor Day only by the number of days necessary to accommodate 
        the district building and remodeling project. 
           Subd. 8.  [WAYZATA.] Notwithstanding Minnesota Statutes, 
        section 126.12, subdivision 1, independent school district No. 
        284, Wayzata, may begin the 1997-1998 school year prior to Labor 
        Day only by the number of days necessary to accommodate the 
        transition into the new senior high school building. 
           Sec. 50.  [FUND TRANSFERS.] 
           Subdivision 1.  [HILL CITY.] (a) Notwithstanding Minnesota 
        Statutes, section 121.912 or 121.9121, on June 30, 1997, 
        independent school district No. 2, Hill City, may permanently 
        transfer up to $55,000 from its general fund to its debt 
        redemption fund for the purpose of repaying the principal and 
        any interest owed on its outstanding debt service loans.  Any 
        amount transferred but not used to repay the debt service loans 
        must be applied to the district's outstanding capital loan 
        balance. 
           (b) The commissioner of children, families, and learning 
        shall recompute the general education fund balance reduction for 
        fiscal year 1997 for independent school district No. 2, Hill 
        City.  For purposes of this reduction, the commissioner shall 
        lower the district's net unappropriated operating balance as of 
        June 30, 1996, by the amount that is transferred from the 
        general fund to the debt redemption fund under paragraph (a). 
           General education aid for fiscal year 1997 for independent 
        school district No. 2, Hill City, must be adjusted according to 
        this subdivision. 
           The general education levy attributable to fiscal year 1997 
        for independent school district No. 2, Hill City, must be 
        adjusted according to this subdivision. 
           Subd. 2.  [FERGUS FALLS.] Notwithstanding Minnesota 
        Statutes, sections 121.912, 121.9121, and 475.61, subdivision 4, 
        on June 30, 1997, independent school district No. 544, Fergus 
        Falls, may permanently transfer up to $202,000 from its debt 
        redemption fund to its building construction fund without making 
        a levy reduction. 
           Subd. 3.  [FOSSTON.] Notwithstanding Minnesota Statutes, 
        sections 121.912, 121.9121, and 475.61, subdivision 4, on June 
        30, 1997, independent school district No. 601, Fosston, may 
        permanently transfer up to $105,000 from the debt redemption 
        fund to its building construction fund without making a levy 
        reduction. 
           Subd. 4.  [MEDFORD.] Notwithstanding Minnesota Statutes, 
        sections 121.912 and 121.9121, independent school district No. 
        763, Medford, may permanently transfer up to a total of $200,000 
        by June 30, 1998, from reserve accounts in the general fund to 
        the unreserved general fund.  The transfers may be made from 
        either the bus purchase account or from the reserve for 
        operating capital account.  Transfers from the bus purchase 
        account may be made without making a levy reduction. 
           Subd. 5.  [BELGRADE-BROOTEN-ELROSA.] Notwithstanding 
        Minnesota Statutes, sections 121.912 and 121.9121, on June 30, 
        1997, independent school district No. 2364, 
        Belgrade-Brooten-Elrosa, may permanently transfer up to $250,000 
        from the bus purchase account to its general fund. 
           Sec. 51.  [CONVEYANCE OF TRUST FUND LANDS; MCLEOD COUNTY.] 
           Notwithstanding Special Laws 1858, chapter 21, as amended 
        by Special Laws 1865, chapter 7; Minnesota Statutes 1866, 
        chapter 35, title 1; Special Laws 1868, chapter 114; or any 
        other law to the contrary, the McLeod county board of 
        commissioners may transfer its existing authority to appoint the 
        trustees of the Stevens Seminary to the Glencoe-Silver Lake 
        school board.  The board may also transfer any other authority 
        held by the board over the trustees to the school board. 
           Sec. 52.  [INDEPENDENT SCHOOL DISTRICT NO. 4, MCGREGOR; 
        LEVY.] 
           Independent school district No. 4, McGregor, may levy, with 
        the approval of the commissioner, to eliminate a deficit in the 
        net unappropriated balance in the operating funds of the 
        district, determined and adjusted and certified by the 
        commissioner as of June 30, 1997.  This amount shall be reduced 
        by referendum revenue authorized under Minnesota Statutes, 
        section 124A.03, pursuant to a plan filed under Minnesota 
        Statutes, section 121.917, and any other revenue made available 
        for this purpose.  The total levy for all years it is made shall 
        not exceed the amount of the deficit.  The proceeds of this levy 
        or other available revenue shall only be used for cash flow 
        requirements and shall not be used to supplement district 
        revenue or income. 
           Sec. 53.  [HIGH SCHOOL LEAGUE COMPENSATION PLAN.] 
           The current total compensation plan for the executive 
        director and for all other league employees shall be reviewed by 
        the commissioner of employee relations.  In considering total 
        compensation for league employees, the commissioner of employee 
        relations shall compare league compensation to the compensation 
        of other Minnesota state employees and school district 
        employees, taking account of the knowledge, skills, 
        responsibilities, and working conditions of the jobs. 
           Sec. 54.  [MODEL STUDENT BILL OF RIGHTS AND 
        RESPONSIBILITIES.] 
           The commissioner of children, families, and learning shall 
        maintain and make available to school boards a model student 
        bill of rights and responsibilities.  The commissioner shall 
        develop the model policy, in consultation with students involved 
        in YMCA youth in government, Project 120, governor's scholars, 
        the student council association, and other student groups. 
           Sec. 55.  [STATE BOARD OF EDUCATION.] 
           The state board of education shall amend its guidelines for 
        approving experimental management systems to eliminate the 
        requirement for renewal after initial approval of an 
        experimental management arrangement. 
           Sec. 56.  [TEACHER RETIREMENT.] 
           (a) Notwithstanding Minnesota Statutes, section 354.41, 
        subdivision 4, a person who is a member of the teacher 
        retirement association and is employed by the Minnesota 
        federation of teachers or its affiliated branches within the 
        state or by the Minnesota education association on July 1, 1997, 
        may remain a coordinated member. 
           (b) Notwithstanding Minnesota Statutes, section 354.41, 
        subdivision 5, payments of the applicable employee 
        contributions, employer contributions, and additional employer 
        contributions under Minnesota Statutes, section 354.42, 
        subdivisions 2, 3, and 5, must be made in a lump sum to the 
        association on or before June 30 of each fiscal year. 
           Sec. 57.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated. 
           Subd. 2.  [PARTNERS FOR QUALITY SCHOOL IMPROVEMENT.] For 
        the school improvement pilot training program: 
             $500,000       .....     1998 
           Up to $20,000 may be used by the Minnesota academic 
        excellence foundation to deliver training, coaching, technical 
        assistance, and other services to selected districts.  Contracts 
        shall be awarded to at least six districts, two each to rural, 
        suburban, and urban school districts.  Any portion of the 
        appropriation not expended in the first year shall not cancel 
        but shall be available until June 30, 1999. 
           Subd. 3.  [PREVENTING VIOLENCE THROUGH PLAYS AND 
        WORKSHOPS.] For administering the grant program for preventing 
        violence through developing plays, workshops, and educational 
        resources: 
             $75,000        .....     1998 
             $75,000        .....     1999 
           Subd. 4.  [CENTENNIAL CLASS SIZE PROJECT.] For a grant to 
        independent school district No. 12, Centennial, for the class 
        size project: 
             $180,000     .....     1998 
             $180,000     .....     1999 
           Any balance remaining in the first year does not cancel but 
        is available in the second year. 
           Subd. 5.  [MODEL SCHOOL FOR CHRONIC TRUANTS.] For the model 
        school for chronic truants located in the law enforcement center 
        in Mankato: 
             $40,000        .....     1998 
             $40,000        .....     1999 
           Subd. 6.  [AQUILA COMMUNITY TOGETHER PROJECT.] For a grant 
        to independent school district No. 283, St. Louis Park, for the 
        Aquila community together project: 
             $30,000        .....     1998 
             $30,000        .....     1999 
           This appropriation must be matched from nonstate sources.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 7.  [MINNESOTA INTERNATIONAL CENTER.] For the 
        Minnesota International Center to encourage and foster contacts 
        between Minnesota school children, their teachers, and people 
        from other nations through international classroom connection: 
             $80,000        .....     1998 
             $80,000        .....     1999 
           Subd. 8.  [COMMUNITY HEALTH CENTER.] For independent school 
        district No. 99, Esko, to develop and operate a community health 
        and physical fitness center offering district residents programs 
        in community health and fitness, athletic training services, and 
        physical therapy: 
             $30,000        .....     1998 
           This appropriation is contingent upon the school district 
        obtaining a $30,000 in-kind contribution of physical fitness 
        equipment from a private nonprofit source that is made 
        permanently available to the community health and physical 
        fitness center. 
           Subd. 9.  [MCGREGOR GRANT.] For a grant to independent 
        school district No. 4, McGregor, to reduce a net operating fund 
        deficit: 
             $50,000     .....     1998
           Sec. 58.  [REPEALER.] 
           Minnesota Statutes 1996, sections 120.105; 120.65; and 
        127.31, subdivision 6, are repealed. 
           Sec. 59.  [EFFECTIVE DATES.] 
           (a) Section 1 applies to the 1997-1998 school year and 
        thereafter.  
           (b) Section 35 is effective January 1, 1998.  
           (c) Sections 37 and 38 are effective 30 days after final 
        enactment.  
           (d) Section 50 is effective retroactively to June 30, 1997. 
           (e) Section 51 is effective the day following final 
        enactment without local approval pursuant to Minnesota Statutes, 
        section 645.021, subdivision 2. 
           (f) If this act is enacted on or after July 1, 1997, 
        section 56 is effective retroactively to July 1, 1997. 
           (g) If this act is enacted on or after July 1, 1997, all 
        sections in this article except for those sections listed in 
        paragraphs (a) to (f) are effective the day following final 
        enactment. 
                                   ARTICLE 8 
                                   LIBRARIES 
           Section 1.  Minnesota Statutes 1996, section 134.155, 
        subdivision 2, is amended to read: 
           Subd. 2.  [GRANTS.] The commissioner of children, families, 
        and learning, in consultation with the multicultural advisory 
        committee established in section 126.82, shall award grants for 
        professional development programs to recruit and educate people 
        of color in the field of library science or information 
        management.  Grant applicants must be a public library 
        jurisdiction with a growing minority population working in 
        collaboration with an accredited institution of higher education 
        with a library education program in the state of Minnesota. 
           Sec. 2.  Minnesota Statutes 1996, section 134.155, 
        subdivision 3, is amended to read: 
           Subd. 3.  [PROGRAM REQUIREMENTS.] (a) A grant recipient 
        shall recruit people of color to be library staff in public 
        libraries and provide support in linking program participants 
        with jobs in the recipient's library jurisdiction. 
           (b) A grant recipient shall establish an advisory council 
        composed of representatives of communities of color. 
           (c) A grant recipient, with the assistance of the advisory 
        council, may recruit high school students, undergraduate 
        students or other persons; support them through the higher 
        education application and admission process; advise them while 
        enrolled; and link them with support resources in the college or 
        university and the community.  
           (d) A grant recipient shall award stipends to people of 
        color enrolled in a library education program to help cover the 
        costs of tuition, student fees, supplies, and books.  Stipend 
        awards must be based upon a student's financial need and 
        students must apply for any additional financial aid for which 
        they are eligible to supplement this program.  No more than ten 
        percent of the grant may be used for costs of administering the 
        program.  Students must agree to work in the grantee library 
        jurisdiction for at least two years after graduation if the 
        student acquires a master's degree and at least three years 
        after graduation if the student acquires both a bachelor's and a 
        master's degree while participating in the program.  If no 
        full-time position is available in the library jurisdiction, the 
        student may fulfill the work requirement in another Minnesota 
        public library.  
           (e) The commissioner of children, families, and learning 
        shall consider the following criteria in awarding grants:  
           (1) whether the program is likely to increase the 
        recruitment and retention of persons of color in librarianship; 
           (2) whether grant recipients will establish or have a 
        mentoring program for persons of color; and 
           (3) whether grant recipients will provide a library 
        internship for persons of color while participating in this 
        program.  
           Sec. 3.  Minnesota Statutes 1996, section 134.34, 
        subdivision 4, is amended to read: 
           Subd. 4.  A regional library basic system support grant 
        shall not be made to a regional public library system for a 
        participating city or county which decreases the dollar amount 
        provided for support for operating purposes of public library 
        service below the amount provided by it for the second preceding 
        year.  This subdivision shall not apply to participating cities 
        or counties where the adjusted net tax capacity of that city or 
        county has decreased, if the dollar amount of the reduction in 
        support is not greater than the dollar amount by which support 
        would be decreased if the reduction in support were made in 
        direct proportion to the decrease in adjusted net tax capacity. 
           Sec. 4.  [LIBRARY PILOT PROJECT.] 
           Subdivision 1.  [ESTABLISHMENT.] Notwithstanding law to the 
        contrary and subject to approvals in subdivision 2, a public 
        library may operate as a pilot project jointly with the school 
        library at Nashwauk-Keewatin high school, located in the city of 
        Nashwauk.  The public library is established to serve persons 
        within the boundaries of independent school district No. 319, 
        except the city of Keewatin. 
           Subd. 2.  [APPROVALS.] Operation of the public library is 
        contingent upon a resolution approved by the governing bodies of 
        cities, towns, and unorganized townships within the geographical 
        boundaries of independent school district No. 319, except for 
        the city of Keewatin.  For the purposes of this subdivision, the 
        Itasca county board is designated as the governing body for the 
        unorganized townships. 
           Subd. 3.  [BOARD; APPOINTMENTS.] The resolution in 
        subdivision 2 shall provide for a library board of five members 
        as follows:  two members appointed by the school board of 
        independent school district No. 319, one member appointed by 
        each town board located within independent school district No. 
        319 boundaries, one member appointed by the council of the city 
        of Nashwauk, and one member appointed by the Itasca county board 
        to represent the unorganized towns within the school district 
        territory. 
           Subd. 4.  [BOARD TERMS; COMPENSATION.] The library board 
        members shall serve for the term of the pilot program.  An 
        appointing authority may remove for misconduct or neglect any 
        member it has appointed to the board and may replace that member 
        by appointment.  Board members shall receive no compensation for 
        their services but may be reimbursed for actual and necessary 
        travel expenses incurred in the discharge of library board 
        duties and activities. 
           Subd. 5.  [FUNDING.] For taxes payable in 1998 and 1999 
        only, the library board may levy a tax in an amount up to 
        $25,000 annually on property located within the boundaries of 
        independent school district No. 319, except the city of 
        Keewatin.  The Itasca county auditor shall collect the tax and 
        distribute it to the library board.  The money may be used for 
        library staff and for the purchase of library materials, 
        including computer software.  The levy must also fund the amount 
        necessary to receive bookmobile services from the Arrowhead 
        regional library system.  For taxes payable in 1998 and 1999 
        only, the county may not levy under Minnesota Statutes, section 
        134.07, for the areas described in this section. 
           Subd. 6.  [BUILDING.] The school district shall provide the 
        physical space and costs associated with operating the library 
        including, but not limited to, heat, light, telephone service, 
        and maintenance. 
           Subd. 7.  [ORGANIZATION.] Immediately after appointment, 
        the library board shall organize by electing one of its number 
        as president and one as secretary, and it may appoint other 
        officers it finds necessary. 
           Subd. 8.  [DUTIES.] The library board shall adopt bylaws 
        and regulations for the library and for the conduct of its 
        business as may be expedient and conformable to law.  It shall 
        have exclusive control of the expenditure of all money collected 
        for it.  The library board shall appoint a qualified library 
        director and other staff, establish the compensation of 
        employees, and remove any of them for cause.  The library board 
        may contract with the school board, the regional library board, 
        or the city in which the library is located to provide 
        personnel, fiscal, or administrative services.  The contract 
        shall state the personnel, fiscal, and administrative services 
        and payments to be provided by each party. 
           Subd. 9.  [CRITERIA.] The library shall meet all 
        requirements in statutes and rules applicable to public 
        libraries and school media centers.  A media supervisor licensed 
        by the board of teaching may be the director of the library.  
        Public parking, restrooms, drinking water, and other necessities 
        shall be easily accessible to library patrons. 
           Subd. 10.  [REPORT.] The library board shall report to the 
        department of children, families, and learning by February 1, 
        1999, about the costs of providing the library service and the 
        number of patrons served. 
           Subd. 11.  [EXPIRATION.] This section expires January 31, 
        2000. 
           Sec. 5.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated.  
           Subd. 2.  [BASIC SUPPORT GRANTS.] For basic support grants 
        according to Minnesota Statutes, sections 134.32 to 134.35: 
             $7,819,000      .....     1998 
             $7,819,000      .....     1999 
           The 1998 appropriation includes $781,000 for 1997 and 
        $7,038,000 for 1998.  
           The 1999 appropriation includes $1,032,000 for 1998 and 
        $7,038,000 for 1999.  
           Subd. 3.  [LIBRARIANS OF COLOR.] For the librarians of 
        color program according to Minnesota Statutes, section 134.155: 
             $55,000     .....     1998
             $55,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 4.  [CHILDREN'S LIBRARY SERVICES GRANTS.] For grants 
        for collaborative programs to strengthen library services to 
        children, young people, and their families: 
             $150,000     .....     1998
             $150,000     .....     1999
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 5.  [MULTICOUNTY, MULTITYPE LIBRARY SYSTEMS.] For 
        grants according to Minnesota Statutes, sections 134.353 and 
        134.354, to multicounty, multitype library systems: 
             $865,000     .....     1998 
             $903,000     .....     1999 
           The 1998 appropriation includes $52,000 for 1997 and 
        $813,000 for 1998.  
           The 1999 appropriation includes $90,000 for 1998 and 
        $813,000 for 1999. 
           Subd. 6.  [REGIONAL PUBLIC LIBRARY SYSTEMS.] For grants to 
        regional public library systems for outreach and direct library 
        services to children and families: 
             $250,000     .....     1998
             $250,000     .....     1999
           In each year $63,000 is for the Metropolitan Library 
        Services Agency and the remainder is for $17,000 to each of the 
        other 11 regional public library systems. 
           Subd. 7.  [LIBRARY PILOT PROJECT.] For a grant for the 
        library pilot project under section 4: 
             $25,000     .....     1998 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Sec. 6.  [REPEALER.] 
           Minnesota Statutes 1996, section 134.34, subdivision 4a, is 
        repealed. 
           Sec. 7.  [EFFECTIVE DATE.] 
           (a) Section 4 is effective in the territory located within 
        independent school district No. 319, except Keewatin, the day 
        after compliance with Minnesota Statutes, section 645.021, 
        subdivision 3, by the last of all the governing bodies for the 
        cities, towns, and unorganized townships.  For the unorganized 
        townships, the governing body is the Itasca county board. 
           (b) If this act is enacted on or after July 1, 1997, all 
        sections in this article except for those sections listed in 
        paragraph (a) are effective the day following final enactment. 
                                   ARTICLE 9 
                                   TECHNOLOGY 
           Section 1.  Minnesota Statutes 1996, section 124.91, 
        subdivision 5, is amended to read: 
           Subd. 5.  [INTERACTIVE TELEVISION.] (a) A school district 
        with its central administrative office located within economic 
        development region one, two, three, four, five, six, seven, 
        eight, nine, and ten may apply to the commissioner of children, 
        families, and learning for ITV revenue up to the greater of .5 
        percent of the adjusted net tax capacity of the district or 
        $25,000 for.  Eligible interactive television expenditures 
        include the construction, maintenance, and lease costs of an 
        interactive television system for instructional purposes.  An 
        eligible school district that has completed the construction of 
        its interactive television system may also purchase computer 
        hardware and software used primarily for instructional purposes 
        and access to the Internet provided that its total expenditures 
        for interactive television maintenance and lease costs and for 
        computer hardware and software under this subdivision do not 
        exceed its interactive television revenue for fiscal year 1998.  
        The approval by the commissioner of children, families, and 
        learning and the application procedures set forth in subdivision 
        1 shall apply to the revenue in this subdivision.  In granting 
        the approval, the commissioner must consider whether the 
        district is maximizing efficiency through peak use and off-peak 
        use pricing structures. 
           (b) To obtain ITV revenue, a district may levy an amount 
        not to exceed the district's ITV revenue times the lesser of one 
        or the ratio of: 
           (1) the quotient derived by dividing the adjusted net tax 
        capacity of the district for the year before the year the levy 
        is certified by the actual pupil units in the district for the 
        year to which the levy is attributable; to 
           (2) 100 percent of the equalizing factor as defined in 
        section 124A.02, subdivision 8, for the year to which the levy 
        is attributable. 
           (c) A district's ITV aid is the difference between its ITV 
        revenue and the ITV levy. 
           (d) The revenue in the first year after reorganization for 
        a district that has reorganized under section 122.22, 122.23, or 
        122.241 to 122.247 shall be the greater of: 
           (1) the revenue computed for the reorganized district under 
        paragraph (a), or 
           (2)(i) for two districts that reorganized, 75 percent of 
        the revenue computed as if the districts involved in the 
        reorganization were separate, or 
           (ii) for three or more districts that reorganized, 50 
        percent of the revenue computed as if the districts involved in 
        the reorganization were separate. 
           (e) The revenue in paragraph (d) is increased by the 
        difference between the initial revenue and ITV lease costs for 
        leases that had been entered into by the preexisting districts 
        on the effective date of the consolidation or combination and 
        with a term not exceeding ten years.  This increased revenue is 
        only available for the remaining term of the lease.  However, in 
        no case shall the revenue exceed the amount available had the 
        preexisting districts received revenue separately. 
           (f) Effective for fiscal year 2000, the revenue under this 
        section shall be 75 percent of the amount determined in 
        paragraph (a); for fiscal year 2001, 50 percent of the amount in 
        paragraph (a); and for fiscal year 2002, 25 percent of the 
        amount in paragraph (a). 
           (g) This section expires effective for revenue for fiscal 
        year 2003, or when leases in existence on the effective date of 
        this act expire. 
           Sec. 2.  Laws 1995, First Special Session chapter 3, 
        article 12, section 7, subdivision 1, is amended to read: 
           Subdivision 1.  [STATE COUNCIL MEMBERSHIP.] The membership 
        of the Minnesota education telecommunications council 
        established in Laws 1993, First Special Session chapter 2, is 
        expanded to include representatives of elementary and secondary 
        education.  The membership shall consist of three 
        representatives from the University of Minnesota; three 
        representatives of the board of trustees for Minnesota state 
        colleges and universities; one representative of the higher 
        education services offices; one representative appointed by the 
        private college council; eight representatives selected by the 
        commissioner of education children, families, and learning, at 
        least one of which must come from each of the six higher 
        education telecommunication regions; a representative from the 
        information policy office; one member two members each from the 
        senate and the house of representatives selected by the 
        subcommittee on committees of the committee on rules and 
        administration of the senate and the speaker of the house, one 
        member from each body must be a member of the minority party; 
        and three representatives of libraries, one representing 
        regional public libraries, one representing multitype libraries, 
        and one representing community libraries, selected by the 
        governor.  The council shall: 
           (1) develop a statewide vision and plans for the use of 
        distance learning technologies and provide leadership in 
        implementing the use of such technologies; 
           (2) recommend to the commissioner and the legislature by 
        December 15, 1996, a plan for long-term governance and a 
        proposed structure for statewide and regional 
        telecommunications; 
           (3) recommend educational policy relating to 
        telecommunications; 
           (4) determine priorities for use; 
           (5) oversee coordination of networks for post-secondary 
        campuses, K-12 education, and regional and community libraries; 
           (6) review application for telecommunications access grants 
        under Minnesota Statutes, section 124C.74 and recommend to the 
        department grants for funding; and 
           (7) determine priorities for grant funding proposals; and 
           (8) work with the information policy office to ensure 
        consistency of the operation of the learning network with 
        standards of an open system architecture. 
           The council shall consult with representatives of the 
        telecommunication industry in implementing this section.  
           Sec. 3.  Laws 1996, chapter 412, article 12, section 11, is 
        amended to read:  
           Sec. 11.  [COOPERATIVE PURCHASING.] 
           The department of children, families, and learning shall 
        work with the department of administration to make available to 
        public libraries, public and nonpublic schools, political 
        subdivisions and state agencies, state level contracts from 
        multiple sources, including manufacturers and software 
        publishers, for the purchase or lease of instructional and 
        administrative software, computers, video, and network hardware. 
        Notwithstanding Minnesota Statutes, section 471.345, public and 
        nonpublic schools, public libraries, and political subdivisions 
        may participate in the contracts a negotiated or a sealed bid 
        contract legally entered into by the state of Minnesota, if it 
        meets their technology purchasing needs. 
           Sec. 4.  [SITE-BASED TECHNOLOGY TRANSFORMATION LEARNING 
        GRANTS.] 
           Subdivision 1.  [ESTABLISHMENT; PURPOSE.] A matching grant 
        program is established for school districts or a group of school 
        districts, the residential academies, and the center for arts 
        education to fund technology projects in support of learning and 
        to increase and enhance closer ties with the community.  
        Projects that are eligible for grant funds include, but are not 
        limited to, hardware and software purchases or leasing and 
        installation, establishment or expansion of local or wide area 
        networks, technical support, and training and staff development 
        in the use of technology and software.  Districts may use the 
        funds for youth entrepreneurship and school-to-work activities, 
        other collaborative efforts, or year-round open enrollment 
        projects. 
           Subd. 2.  [GOALS.] The goals for this grant program include 
        the creation of projects that accomplish one or more of the 
        following: 
           (1) enhance teaching and learning productivity through the 
        use of technology; 
           (2) develop individual learner classroom-based teaching and 
        learning systems that can be aggregated into site, district, and 
        state frameworks; 
           (3) develop personalized learning plans designed to give 
        learners more responsibility for their learning success and 
        change the role of teacher to learning facilitator; 
           (4) match and allocate resources; 
           (5) create a curriculum environment that is multiplatform; 
           (6) provide user and contributor access to electronic 
        libraries; 
           (7) schedule activities; 
           (8) automate progress reports; 
           (9) increase collaboration between school district and 
        sites, with businesses, higher education institutions, 
        libraries, and local government units; 
           (10) correlate state-defined outcomes from the graduation 
        rule to curriculum for each student; 
           (11) increase accountability through a reporting system; 
           (12) provide technical support, project evaluation, 
        dissemination services, and replication; and 
           (13) connect to the Learning Network of Minnesota. 
           Subd. 3.  [APPLICATION; ELIGIBILITY.] The commissioner of 
        children, families, and learning shall establish a process and 
        application forms for grant funds.  Eligible applicants must, at 
        a minimum, identify the specific site needs that the project 
        will address, define the project's expected outcomes, and 
        provide the source, type, and amounts of all matching funds.  To 
        be eligible for a site-based technology learning grant, a school 
        district must:  
           (1) for districts of 5,000 pupils in average daily 
        membership or more, have each dollar of grant money matched by 
        at least one dollar of school district money, plus at least one 
        dollar of either nonstate or nonschool district money, or 
        in-kind contributions; 
           (2) for districts under 5,000 pupils in average daily 
        membership, indicate what attempts to provide a one-to-one match 
        have been made prior to the filing of the application; 
           (3) agree to disseminate and share information about its 
        project; 
           (4) provide a benefit to the greater community; and 
           (5) maintain any ongoing costs of support for the 
        technology project after the initial funding under the grant 
        program. 
           Districts may count toward their match any eligible 
        expenditures made from July 1, 1996.  The residential academies 
        and the center for arts education do not need to provide a 
        matching amount. 
           Subd. 4.  [COMPETITIVE TECHNOLOGY TRANSFORMATION LEARNING 
        GRANTS.] By August 15, 1997, the department of children, 
        families, and learning shall establish guidelines and an 
        application process.  The money must provide technology at 
        school sites, including media centers, community education 
        sites, the center for arts education, or at the residential 
        academies.  The department shall consider the level of 
        comprehensiveness of a district's technology plan including 
        integration of curriculum and graduation standards in awarding 
        the grants. 
           Sec. 5.  [LEARNING AND ELECTRONIC CURRICULUM RESOURCE 
        NETWORK.] 
           Subdivision 1.  [RESOURCE NETWORK.] (a) The commissioner of 
        children, families, and learning shall contract with multiple 
        vendors to develop a learning resource network that expands the 
        electronic curriculum library under Laws 1996, chapter 412, 
        article 12, section 15, subdivision 4, paragraph (a), and to 
        support the statewide implementation of the graduation standards.
           (b) The expansion shall include a centralized repository of 
        curriculum that serves as a resource for teachers and not for 
        instructional delivery software.  The curriculum contained 
        within the library must be aligned with the content standards of 
        the graduation rule.  Post-secondary institutions may apply for 
        the electronic curriculum resource project if the institutions 
        make curriculum available through the repository.  The 
        department of children, families, and learning shall set 
        standards to assist in alignment of individualized learning 
        plans systems to the centralized repository.  The commissioner 
        may require a match of local and private funds as part of the 
        application process. 
           (c) The commissioner shall consult with representatives 
        from the public and private sector in the development, use, and 
        operation of the learning resource network.  The commissioner 
        shall compile a list of vendors of software that can be used to 
        support implementation of the graduation standards.  The 
        commissioner shall also identify district-initiated projects and 
        facilitate collaboration between districts to develop and adapt 
        electronic teaching and administering tools.  In addition to the 
        electronic curriculum repository vendors, the sites in clauses 
        (1) to (5) shall be considered as vendors eligible for grants: 
           (1) a project for the Gopher biology shareware at the 
        University of Minnesota to make multimedia instructional 
        management software available at no cost to both kindergarten 
        through grade 12 and higher education faculty throughout the 
        state, to train faculty and technology support staff in 
        kindergarten through grade 12 districts both on how to use the 
        software and database, as well as how to design curricula to 
        take full advantage of the software, and to model how students 
        and teachers can use computers to enhance teaching and learning; 
           (2) a project for the midstate educational district and 
        independent school district No. 482, Little Falls, to 
        demonstrate student interaction with the local business 
        community; 
           (3) a project for independent school district Nos. 178, 
        Storden-Jeffers; 633, Lamberton; and 638, Sanborn, to establish 
        a high school program for remote access for learners to the 
        districts' educational network of data and training, commercial 
        access for youth entrepreneurship, and commercial access for 
        school-to-work programs; 
           (4) a project for the University of Minnesota for the Bell 
        Museum of Natural History to deliver science curriculum through 
        distance learning methods; 
           (5) a project for the East Range Secondary Technical Center 
        to purchase equipment for classroom and laboratories to 
        demonstrate effective integration of technology into the 
        curriculum; and 
           (6) a project for the Walker Art Center and the Minneapolis 
        Institute of Arts for an arts via the Internet project.  The 
        project will connect, via the Internet, the thousands of objects 
        in these two collections to every classroom, library, college 
        and university, historical sites, and study centers in the state 
        by digitizing the collections. 
           Subd. 2.  [FOOD SERVICE DATA MANAGEMENT.] The department of 
        children, families, and learning shall work with districts to 
        identify and help implement computer software to improve 
        district's management of meal costs, meal program tracking, and 
        government reporting of meals served.  The commissioner may 
        provide funding for this software under section 4. 
           Subd. 3.  [INTERNET ACCESS.] The commissioner of children, 
        families, and learning shall develop and distribute a model 
        policy for school districts concerning appropriate access and 
        usage of the Internet with recommended protocols for staff and 
        students to follow in order to maximize the educational benefits 
        of on-line access and services. 
           Subd. 4.  [AT HOME-ACCESS FOR CURRICULUM AND TEACHING.] The 
        Internet access for Minnesota school projects, the InforMNs 
        project, shall be continued for the next biennium. 
           Sec. 6.  [LEARNING ACADEMY.] 
           Subdivision 1.  [ESTABLISHMENT.] The commissioner shall 
        develop standards and requirements and certify courses for a 
        Minnesota learning academy to provide training opportunities for 
        educators, administrators, and librarians in the use of 
        technology and its integration into learning activities for 
        meeting the educational needs of all students.  Only certified 
        classes may be used to fulfill the requirements of the learning 
        academy. 
           Subd. 2.  [DEVELOPMENT OF THE LEARNING ACADEMY.] To develop 
        the learning academy, the commissioner shall consult with 
        representatives of public schools, higher education, teacher 
        organizations, students, private business, state agencies, 
        libraries, and political subdivisions to do the following: 
           (1) set measures for teacher training opportunities on 
        technical skills and technology integration skills; 
           (2) identify and establish outcomes for a series of 
        training courses that provide for technical skills and 
        technology classroom integration skills; 
           (3) identify existing education organizations, public, or 
        private institutions to develop and provide training courses; 
           (4) evaluate prerequisites for the classroom integration 
        skills course; 
           (5) certify or decertify classes and courses for inclusion 
        in or exclusion from the learning academy; and 
           (6) coordinate and make certified classes and courses 
        available to eligible participants. 
           Subd. 3.  [FUNDING.] The commissioner shall use available 
        appropriations to provide start-up and initial operating 
        subsidies for the learning academy sites.  Appropriated funds 
        may also be used to partially subsidize costs of attendees of 
        the academy. 
           Sec. 7.  [LIBRARY SITE TECHNOLOGY GRANTS.] 
           Subdivision 1.  [ESTABLISHMENT; PURPOSE.] A matching grant 
        program is established to fund library site technology grants.  
        The grants are available to public or school library sites or to 
        a partnership of library sites.  Recipients shall use grant 
        proceeds for technology projects that are consistent with 
        technology plans and the LDS/MINITEX Joint Standards and 
        Guidelines for Automated Library Systems.  The grants shall fund 
        projects to expand and integrate technology into library 
        operations and increase public access to technology by: 
           (1) converting school media center bibliographic records 
        into a standard format; 
           (2) loading school library site media records into 
        regional, public, or multicounty, multitype library systems or 
        other appropriate library networks; 
           (3) upgrading and increasing database development; and 
           (4) improving library staff use of networked library 
        resources at library sites throughout the regional multitype 
        cooperatives. 
           Subd. 2.  [APPLICATION; ELIGIBILITY.] The commissioner of 
        children, families, and learning shall establish a process and 
        application forms for library sites to apply for grant funds.  
        Libraries must describe how they will cooperate with schools.  
        An applicant must submit a technology plan with the 
        application.  Eligible applicants must, at a minimum, describe 
        how the proposed project is consistent with the technology plan; 
        describe how it ensures interoperability of hardware, software, 
        and telecommunication; identify the specific site needs that the 
        project will address; define the project's expected outcomes; 
        and provide the source, type, and amounts of all matching 
        funds.  To be eligible for a site-based technology learning 
        grant, a library site must: 
           (1) be a school library, a public library, or a partnership 
        of public and school libraries; 
           (2) have each dollar of grant money matched by at least $1 
        of library site money, including in-kind contributions; 
           (3) agree to disseminate and share information about its 
        project; 
           (4) provide a benefit to the greater community; and 
           (5) maintain any ongoing costs of support for the 
        technology project after the initial funding under the grant 
        program. 
           Subd. 3.  [GRANT AWARD.] The commissioner shall consult 
        with representatives of the public and private sectors in 
        establishing criteria and awarding site-based technology 
        learning grants. 
           Sec. 8.  [REFURBISHED COMPUTER PROGRAM.] 
           The commissioner of children, families, and learning shall 
        establish a program to refurbish donated computers to increase 
        the number of multimedia computers in Minnesota schools.  In 
        establishing the program, the commissioner shall work with the 
        commissioners of administration and corrections, and the office 
        of technology.  The program must be implemented in conjunction 
        with the education technology improvement clearinghouses under 
        Minnesota Statutes, section 121.95, and in partnership with 
        business, nonprofit organizations, and institutions of higher 
        education.  The commissioner must consider the most 
        cost-effective approach in allocating funds for computer 
        recycling or refurbishing.  The program must: 
           (1) establish the number of multimedia computers to be 
        refurbished by July 1, 2000; 
           (2) establish partnerships with nonprofit or business 
        organizations to solicit donations; 
           (3) develop an agreement with the commissioner of 
        corrections to facilitate computers in Minnesota correctional 
        institutions with procedures to minimize security risks; 
           (4) promote the program to public and nonpublic schools; 
        and 
           (5) develop plans to equitably distribute computers to 
        public and nonpublic schools and ensure proper recycling of 
        unsuitable equipment. 
           Sec. 9.  [TELECOMMUNICATIONS TECHNOLOGY PLAN.] 
           The department of children, families, and learning shall 
        develop criteria for approving telecommunications technology 
        plans developed by school sites, school districts, or libraries 
        to enable them to obtain telecommunications discounts provided 
        under federal law.  The department shall take actions necessary 
        to enable all Minnesota schools and libraries to apply for 
        discounts and federal universal service support available 
        January 1, 1998. 
           Sec. 10.  [YEAR 2000 READY.] 
           The commissioner of children, families, and learning shall 
        ensure that any computer software or hardware that is purchased 
        with money appropriated in this bill must be year 2000 ready. 
           Sec. 11.  [ADDITIONAL TECHNOLOGY REVENUE.] 
           For fiscal year 1998 only, the allowance in Minnesota 
        Statutes, section 124A.22, subdivision 10, paragraph (a), is 
        increased by: 
           (1) $24 per pupil unit; or 
           (2) the lesser of $25,000 or $80 per pupil unit. 
           Revenue received under this section must be used according 
        to Minnesota Statutes, section 124A.22, subdivision 11, clauses 
        (15), (18), (19), (23), and (24). 
           Sec. 12.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated, 
        unless otherwise indicated, from the general fund to the 
        department of children, families, and learning for the fiscal 
        years designated.  The appropriations in subdivisions 6 and 7 
        are one-time appropriations only. 
           Subd. 2.  [TELECOMMUNICATIONS ACCESS GRANTS.] For grants to 
        school districts and regional public library systems to 
        establish telecommunication connections according to Minnesota 
        Statutes, section 124C.74: 
             $13,000,000     .....     1998 
             $10,000,000     .....     1999 
           Any balance in the first year does not cancel but is 
        available in the second year.  
           This amount shall not be included as part of the base for 
        fiscal year 2000-2001. 
           In allocating grant funds, the council, as appropriate, may 
        consider expenditures by district made from July 1, 1995. 
           Subd. 3.  [SITE-BASED TECHNOLOGY TRANSFORMATION LEARNING 
        GRANTS.] For grants under section 4: 
             $14,000,000     .....     1998 
           Of this amount $300,000 is for an open enrollment 
        year-round technology project in independent school district No. 
        138, North Branch.  
           This appropriation is available until June 30, 1999. 
           Subd. 4.  [LIBRARY SITE TECHNOLOGY GRANT PROGRAM.] For 
        one-time library site grants under section 7: 
             $3,500,000      .....     1998 
           This appropriation is available until June 30, 1999. 
           Subd. 5.  [COMPUTER REFURBISHMENT PROGRAM.] For the 
        multimedia computer refurbishment program under section 8: 
             $6,000,000      .....     1998
           The commissioner may use up to $250,000 of this amount for 
        the education technology improvement clearinghouses under 
        Minnesota Statutes, section 121.95. 
           The commissioner may use all or part of this appropriation 
        for an agreement with the commissioner of corrections to 
        establish refurbishment centers at one or more correctional 
        institutions. 
           These funds are available until June 30, 2000. 
           Subd. 6.  [ELECTRONIC CURRICULUM RESOURCE.] For support of 
        electronic curriculum development: 
             $4,000,000     .....     1998
           Of this amount, $2,700,000 is for the electronic curriculum 
        resource under section 5, $1,000,000 of which is for the 
        collaborative arts project in section 5, subdivision 1, 
        paragraph (c), clause (5). 
           Of this amount, $300,000 is for the purposes of the Gopher 
        Biology Shareware Project under section 5, subdivision 1, 
        paragraph (c), clause (1). 
           Subd. 7.  [UNIVERSITY OF MINNESOTA; BELL MUSEUM.] For a 
        grant to the University of Minnesota for the Bell Museum of 
        Natural History to deliver science curriculum through distance 
        learning methods under section 5, subdivision 1, paragraph (c), 
        clause (3): 
             $500,000    .....     1998
             $500,000    .....     1999
           Subd. 8.  [INTERACTIVE TELEVISION (ITV) AID.] For 
        interactive television (ITV) aid under Minnesota Statutes, 
        section 124.91, subdivision 5: 
             $4,030,000     .....     1998
             $4,052,000     .....     1999
           The 1998 appropriation includes $384,000 for 1997 and 
        $3,646,000 for 1998. 
           The 1999 appropriation includes $405,000 for 1998 and 
        $3,647,000 for 1999. 
           Subd. 9.  [INSTRUCTIONAL TRANSFORMATION THROUGH TECHNOLOGY 
        GRANTS.] For grants according to Laws 1995, First Special 
        Session chapter 3, article 12, section 8: 
             $ 1,000,000    .....     1998
           This appropriation is available until June 30, 1999. 
           Subd. 10.  [ADDITIONAL OPERATING CAPITAL.] For a one-time 
        increase in operating capital according to section 11: 
             $25,000,000    .....     1998
           Subd. 11.  [LEARNING ACADEMY.] For training and staff 
        development according to section 6: 
             $2,000,000     .....     1998
           This appropriation is available until June 30, 1999. 
           Subd. 12.  [TECHNOLOGY ENHANCEMENT; RESIDENTIAL ACADEMIES.] 
        For technology improvements at the Minnesota state academies: 
             $500,000       .....     1998 
             $500,000       .....     1999 
           The appropriation is for implementing the Minnesota state 
        academies' technology plan including completion of a local area 
        network; installation of ten technology laboratories, classroom 
        work stations, and additional hardware and software; purchases 
        of large-screen monitors, speech synthesizers, screen-reader 
        software, and braille display; and technology support and 
        maintenance to assist the academies in fulfilling their 
        educational mission. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 13.  [REGIONAL MANAGEMENT INFORMATION CENTERS.] The 
        sum indicated in this subdivision is appropriated from the 
        general fund to the office of technology for the fiscal year 
        designated.  For grants to regional management information 
        centers under Minnesota Statutes, section 121.935, for the 
        transition period in their technology uses and consolidation of 
        processing needs: 
             $978,000       .....     1998 
           This appropriation is available until June 30, 1999. 
           Sec. 13.  [REPEALER.] 
           (a) Minnesota Statutes 1996, section 124C.74, is repealed 
        effective July 1, 1999.  
           (b) Minnesota Statutes 1996, section 134.46, is repealed. 
           Sec. 14.  [EFFECTIVE DATE.] 
           If this act is enacted on or after July 1, 1997, sections 1 
        to 13 are effective the day following final enactment. 
                                   ARTICLE 10
                                 STATE AGENCIES
           Section 1.  Minnesota Statutes 1996, section 128A.02, is 
        amended by adding a subdivision to read: 
           Subd. 7.  [GRANTS.] The state board, through the chief 
        administrators of the academies, may apply for all competitive 
        grants administered by agencies of the state and other 
        government or nongovernment sources.  Application may not be 
        made for grants over which the board has discretion. 
           Sec. 2.  Minnesota Statutes 1996, section 129C.10, 
        subdivision 3, is amended to read: 
           Subd. 3.  [POWERS AND DUTIES OF BOARD.] (a) The board has 
        the powers necessary for the care, management, and control of 
        the Lola and Rudy Perpich Minnesota center for arts education 
        and all its real and personal property.  The powers shall 
        include, but are not limited to, those listed in this 
        subdivision. 
           (b) The board may employ and discharge necessary employees, 
        and contract for other services to ensure the efficient 
        operation of the center for arts education. 
           (c) The board may receive and award grants.  The board may 
        establish a charitable foundation and accept, in trust or 
        otherwise, any gift, grant, bequest, or devise for educational 
        purposes and hold, manage, invest, and dispose of them and the 
        proceeds and income of them according to the terms and 
        conditions of the gift, grant, bequest, or devise and its 
        acceptance.  The board shall adopt internal procedures to 
        administer and monitor aids and grants. 
           (d) The board may establish or coordinate evening, 
        continuing education, extension, and summer programs for 
        teachers and pupils. 
           (e) The board may identify pupils who have artistic talent, 
        either demonstrated or potential, in dance, literary arts, media 
        arts, music, theater, and visual arts, or in more than one art 
        form. 
           (f) The board shall educate pupils with artistic talent by 
        providing:  
           (1) an interdisciplinary academic and arts program for 
        pupils in the 11th and 12th grades.  The total number of pupils 
        accepted under this clause and clause (2) shall not exceed 300; 
           (2) additional instruction to pupils for a 13th grade. 
        Pupils eligible for this instruction are those enrolled in 12th 
        grade who need extra instruction and who apply to the board, or 
        pupils enrolled in the 12th grade who do not meet learner 
        outcomes established by the board.  Criteria for admission into 
        the 13th grade shall not be subject to chapter 14; 
           (3) intensive arts seminars for one or two weeks for pupils 
        in grades 9 to 12; 
           (4) summer arts institutes for pupils in grades 9 to 12; 
           (5) artist mentor and extension programs in regional sites; 
        and 
           (6) teacher education programs for indirect curriculum 
        delivery. 
           (g) The board may determine the location for the Lola and 
        Rudy Perpich Minnesota center for arts education and any 
        additional facilities related to the center, including the 
        authority to lease a temporary facility. 
           (h) The board must plan for the enrollment of pupils on an 
        equal basis from each congressional district.  
           (i) The board may establish task forces as needed to advise 
        the board on policies and issues.  The task forces expire as 
        provided in section 15.059, subdivision 6.  
           (j) The board may request the commissioner of children, 
        families, and learning for assistance and services. 
           (k) The board may enter into contracts with other public 
        and private agencies and institutions for residential and 
        building maintenance services if it determines that these 
        services could be provided more efficiently and less expensively 
        by a contractor than by the board itself.  The board may also 
        enter into contracts with public or private agencies and 
        institutions, school districts or combinations of school 
        districts, or service cooperatives to provide supplemental 
        educational instruction and services. 
           (l) The board may provide or contract for services and 
        programs by and for the center for arts education, including a 
        store, operating in connection with the center; theatrical 
        events; and other programs and services that, in the 
        determination of the board, serve the purposes of the center. 
           (m) The board may provide for transportation of pupils to 
        and from the center for arts education for all or part of the 
        school year, as the board considers advisable and subject to its 
        rules.  Notwithstanding any other law to the contrary, the board 
        may charge a reasonable fee for transportation of pupils.  Every 
        driver providing transportation of pupils under this paragraph 
        must possess all qualifications required by the state board of 
        education.  The board may contract for furnishing authorized 
        transportation under rules established by the commissioner of 
        children, families, and learning and may purchase and furnish 
        gasoline to a contract carrier for use in the performance of a 
        contract with the board for transportation of pupils to and from 
        the center for arts education.  When transportation is provided, 
        scheduling of routes, establishment of the location of bus 
        stops, the manner and method of transportation, the control and 
        discipline of pupils, and any other related matter is within the 
        sole discretion, control, and management of the board. 
           (n) The board may provide room and board for its pupils.  
        If the board provides room and board, it shall charge a 
        reasonable fee for the room and board.  The fee is not subject 
        to chapter 14 and is not a prohibited fee according to sections 
        120.71 to 120.76. 
           (o) The board may establish and set fees for services and 
        programs without regard to chapter 14.  If the board sets fees 
        not authorized or prohibited by the Minnesota public school fee 
        law, it may do so without complying with the requirements of 
        section 120.75, subdivision 1. 
           (p) The board may apply for all competitive grants 
        administered by agencies of the state and other government or 
        nongovernment sources. 
           Sec. 3.  [APPROPRIATIONS; DEPARTMENT OF CHILDREN, FAMILIES, 
        AND LEARNING.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated. 
           Subd. 2.  [DEPARTMENT.] For the department of children, 
        families, and learning: 
             $24,360,000    .....      1998
             $23,978,000    .....      1999
           (a) Any balance in the first year does not cancel but is 
        available in the second year. 
           (b) $21,000 each year is from the trunk highway fund. 
           (c) $622,000 in 1998 and $627,000 in 1999 is for the 
        academic excellence foundation. 
           Up to $50,000 each year is contingent upon the match of $1 
        in the previous year from private sources consisting of either 
        direct monetary contributions or in-kind contributions of 
        related goods or services, for each $1 of the appropriation.  
        The commissioner of children, families, and learning must 
        certify receipt of the money or documentation for the private 
        matching funds or in-kind contributions.  The unencumbered 
        balance from the amount actually appropriated from the 
        contingent amount in 1998 does not cancel but is available in 
        1999.  The amount carried forward must not be used to establish 
        a larger annual base appropriation for later fiscal years. 
           (d) $207,000 in 1998 and $210,000 in 1999 is for the state 
        board of education. 
           (e) $230,000 in 1998 and $234,000 in 1999 is for the board 
        of teaching. 
           (f) The expenditures of federal grants and aids as shown in 
        the biennial budget document and its supplements are approved 
        and appropriated and shall be spent as indicated. 
           (g) The department of children, families, and learning 
        shall develop a performance report on the quality of its 
        programs and services.  The report must be consistent with the 
        process specified in Minnesota Statutes, sections 15.90 to 
        15.92.  The goals, objectives, and measures of this report must 
        be developed in cooperation with the chairs of the finance 
        divisions of the education committees of the house of 
        representatives and senate, the department of finance, and the 
        office of legislative auditor.  The report must include data to 
        indicate the progress of the department in meeting its goals and 
        objectives. 
           (h) At least $50,000 is to ensure compliance with state and 
        federal laws prohibiting discrimination because of race, 
        religion, or sex.  The department shall use the appropriation to 
        provide state-level leadership on equal education opportunities 
        which promote elimination of discriminatory practices in the 
        areas of race, religion, and sex in public schools and public 
        educational agencies under its general supervision and on 
        activities including, at least, compliance monitoring and 
        voluntary compliance when local school district deficiencies are 
        found. 
           (i) Notwithstanding Minnesota Statutes, section 15.53, 
        subdivision 2, the commissioner of children, families, and 
        learning may contract with a school district for a period no 
        longer than five consecutive years to work in the development or 
        implementation of the graduation rule.  The commissioner may 
        contract for services and expertise as necessary.  The contracts 
        are not subject to Minnesota Statutes, sections 16B.06 to 16B.08.
           (j) In preparing the department budget for fiscal years 
        2000-2001, the department shall shift all administrative funding 
        from aids appropriations into the appropriation for the 
        department. 
           (k) Reallocations of excesses under Minnesota Statutes, 
        section 124.14, subdivision 7, from appropriations within this 
        act shall only be made to deficiencies in programs with 
        appropriations contained within this act. 
           (l) $850,000 each year is for litigation costs and may only 
        be used for those purposes.  These appropriations are one-time 
        only. 
           (m) Collaborative efforts between the department of 
        children, families, and learning and the office of technology, 
        as specified in Minnesota Statutes, section 237A.015, include: 
           (1) advising the commissioner of children, families, and 
        learning on new and emerging technologies, potential business 
        partnerships, and technical standards; 
           (2) assisting the commissioner of children, families, and 
        learning in the sharing of data between state agencies relative 
        to children's programs; and 
           (3) as requested by the commissioner of children, families, 
        and learning, assisting in collaborative efforts for joint 
        prekindergarten through grade 12 and higher education projects, 
        including the learning network. 
        The commissioner of children, families, and learning shall have 
        final approval for prekindergarten through grade 12 programs and 
        lifelong learning programs, grant awards, and funding decisions. 
           Sec. 4.  [APPROPRIATIONS; LOLA AND RUDY PERPICH MINNESOTA 
        CENTER FOR ARTS EDUCATION.] 
           The sums indicated in this section are appropriated from 
        the general fund to the center for arts education for the fiscal 
        years designated: 
            $5,541,000     .....     1998
            $6,054,000     .....     1999
           Of the fiscal year 1998 appropriation, $154,000 is to fund 
        artist and arts organization participation in the education 
        residency and education technology projects, $75,000 is for 
        school support for the residency project, and $121,000 is for 
        further development of the partners:  arts and school for 
        students (PASS) program, including pilots.  Of the fiscal year 
        1999 appropriation, $154,000 is to fund artist and arts 
        organizations participation in the education residency project, 
        $75,000 is for school support for the residency project, and 
        $121,000 is to fund the PASS program, including additional 
        pilots.  The guidelines for the education residency project and 
        the pass program shall be developed and defined by the center 
        for arts education in cooperation with the Minnesota arts 
        board.  The Minnesota arts board shall participate in the review 
        and allocation process.  The center for arts education and the 
        Minnesota arts board shall cooperate to fund these projects. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Sec. 5.  [APPROPRIATIONS; FARIBAULT ACADEMIES.] 
           The sums indicated in this section are appropriated from 
        the general fund to the department of children, families, and 
        learning for the Faribault academies for the fiscal years 
        designated:  
             $8,910,000     .....     1998
             $8,908,000     .....     1999 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           In the next biennial budget, the academies must assess 
        their progress in meeting the established performance measures 
        for the Faribault academies and inform the legislature on the 
        content of that assessment.  The information must include an 
        assessment of its progress by consumers and employees. 
           Sec. 6.  [EFFECTIVE DATE.] 
           If this act is enacted on or after July 1, 1997, sections 1 
        to 5 are effective the day following final enactment. 
                                   ARTICLE 11
                      TECHNICAL AND CONFORMING AMENDMENTS
           Section 1.  Minnesota Statutes 1996, section 124.155, 
        subdivision 2, is amended to read: 
           Subd. 2.  [ADJUSTMENT TO AIDS.] (a) The amount specified in 
        subdivision 1 shall be used to adjust the following state aids 
        and credits in the order listed: 
           (1) general education aid authorized in sections 124A.23 
        and 124B.20; 
           (2) secondary vocational aid authorized in section 124.573; 
           (3) special education aid authorized in sections 124.32, 
        124.3201, and 124.3202; 
           (4) secondary vocational school-to-work program aid for 
        children with a disability authorized in section 124.574; 
           (5) aid for pupils of limited English proficiency 
        authorized in section 124.273; 
           (6) transportation aid authorized in section 124.225; 
           (7) community education programs aid authorized in section 
        124.2713; 
           (8) adult education aid authorized in section 124.26; 
           (9) early childhood family education aid authorized in 
        section 124.2711; 
           (10) capital expenditure aid authorized in sections 
        124.243, 124.244, and 124.83; 
           (11) school district cooperation aid authorized in section 
        124.2727; 
           (12) assurance of mastery aid according to section 124.311; 
           (13) homestead and agricultural credit aid, disparity 
        credit and aid, and changes to credits for prior year 
        adjustments according to section 273.1398, subdivisions 2, 3, 4, 
        and 7; 
           (14) attached machinery aid authorized in section 273.138, 
        subdivision 3; 
           (15) alternative delivery aid authorized in section 
        124.322; 
           (16) special education equalization aid authorized in 
        section 124.321; 
           (17) special education excess cost aid authorized in 
        section 124.323; 
           (18) learning readiness aid authorized in section 124.2615; 
        and 
           (19) cooperation-combination aid authorized in section 
        124.2725. 
           (b) The commissioner of children, families, and learning 
        shall schedule the timing of the adjustments to state aids and 
        credits specified in subdivision 1, as close to the end of the 
        fiscal year as possible. 
           Sec. 2.  Minnesota Statutes 1996, section 124.321, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [LEVY EQUALIZATION REVENUE.] (a) For fiscal 
        years 1996 and later, special education levy equalization 
        revenue for a school district, excluding an intermediate school 
        district, equals the sum of the following amounts: 
           (1) the levy percentage factor for that year times the 
        district's special education revenue under section 124.3201; 
        plus 
           (2) the levy percentage factor for that year times the 
        district's special education summer program revenue under 
        section 124.3202; plus 
           (3) the levy percentage factor for that year times the 
        district's special education excess cost revenue under section 
        124.323; plus 
           (4) the levy percentage factor for that year times the 
        district's secondary vocational education school-to-work program 
        for children with a disability revenue under section 124.574; 
        plus 
           (5) the levy percentage factor for that year times the 
        district's limited English proficiency programs revenue under 
        section 124.273. 
           Sec. 3.  Minnesota Statutes 1996, section 124A.225, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [REVENUE.] Of a district's general 
        education revenue an amount equal to the sum of the number of 
        elementary fund balance pupils in average daily membership 
        defined in section 124.17, subdivision 1h 1f, and one-half of 
        the number of kindergarten fund balance pupils in average daily 
        membership as defined in section 124.17, subdivision 1h 1f, 
        times .06 for fiscal year 1995 and thereafter times the formula 
        allowance must be reserved according to this section. 
           Sec. 4.  [EFFECTIVE DATE.] 
           If this act is enacted on or after July 1, 1997, sections 1 
        to 3 are effective the day following final enactment. 
                                   ARTICLE 12 
                               SCHOOL BUS SAFETY 
           Section 1.  [121.175] [ADVERTISING ON SCHOOL BUSES.] 
           (a) The commissioner, through a competitive process, and 
        with the approval of the school bus safety advisory committee 
        may contract with advertisers regarding advertising on school 
        buses.  At a minimum, the contract must prohibit advertising and 
        advertising images that: 
           (1) solicit the sale of, or promote the use of, alcoholic 
        beverages and tobacco products; 
           (2) are discriminatory in nature or content; 
           (3) imply or declare an endorsement of the product or 
        service by the school district; 
           (4) contain obscene material; 
           (5) are false, misleading, or deceptive; or 
           (6) relate to an illegal activity or antisocial behavior. 
           (b) Advertisement must meet the following conditions: 
           (1) the advertising attached to the school bus does not 
        interfere with bus identification under section 169.441; and 
           (2) the bus with attached advertising meets the school bus 
        equipment standards under sections 169.4501 to 169.4504. 
           (c) All buses operated by school districts may be attached 
        with advertisements under the state contract.  All school 
        district contracts shall include a provision for advertisement.  
        Each school district shall be reimbursed by the advertiser for 
        all costs incurred by the district and its contractors for 
        supporting the advertising program, including, but not limited 
        to, retrofitting buses, storing advertising, attaching 
        advertising to the bus, and related maintenance. 
           (d) The commissioner shall hold harmless and indemnify each 
        district for all liabilities arising from the advertising 
        program.  Each district must tender defense of all such claims 
        to the commissioner within five days of receipt. 
           (e) All revenue from the contract shall be deposited in the 
        general fund. 
           Sec. 2.  Minnesota Statutes 1996, section 123.799, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [RESERVED REVENUE USE.] A district shall 
        use the student transportation safety reserved revenue under 
        section 124.225, subdivision 7f, for providing student 
        transportation safety programs to enhance student conduct and 
        safety on the bus or when boarding and exiting the bus.  A 
        district's student transportation policy must specify the 
        student transportation safety activities to be carried out under 
        this section.  A district's student transportation safety 
        reserved revenue may only be used for the following purposes: 
           (1) to provide paid adult bus monitors, including training 
        and salary costs; 
           (2) to provide a volunteer bus monitor program, including 
        training costs and the cost of a program coordinator; 
           (3) to purchase or lease optional external public address 
        systems or video recording cameras for use on buses; and 
           (4) to purchase new or retrofit existing school buses with 
        seatbelts or other occupant restraint systems after consultation 
        with and approval by the commissioner of public safety; and 
           (4) (5) other activities or equipment that have been 
        reviewed by the state school bus safety advisory committee and 
        approved by the commissioner of public safety. 
           Sec. 3.  Minnesota Statutes 1996, section 123.7991, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [SCHOOL BUS SAFETY WEEK.] The first third 
        week of school is designated as school bus safety week. 
           A school board may designate one day of school bus safety 
        week as school bus driver day. 
           Sec. 4.  Minnesota Statutes 1996, section 123.7991, 
        subdivision 2, is amended to read: 
           Subd. 2.  [STUDENT TRAINING.] (a) Each school district 
        shall provide public school pupils enrolled in grades 
        kindergarten through 10 with age-appropriate school bus safety 
        training.  The training shall be results-oriented and shall 
        consist of both classroom instruction and practical training 
        using a school bus.  Upon completing the training, a student 
        shall be able to demonstrate knowledge and understanding of at 
        least the following competencies and concepts: 
           (1) transportation by school bus is a privilege and not a 
        right; 
           (2) district policies for student conduct and school bus 
        safety; 
           (3) appropriate conduct while on the school bus; 
           (4) the danger zones surrounding a school bus; 
           (5) procedures for safely boarding and leaving a school 
        bus; 
           (6) procedures for safe street or road crossing; and 
           (7) school bus evacuation and other emergency procedures. 
           (b) Each nonpublic school located within the district shall 
        provide all nonpublic school pupils enrolled in grades 
        kindergarten through 10 who are transported by school bus at 
        public expense and attend school within the district's 
        boundaries with training as required in paragraph (a).  The 
        school district shall make a bus available for the practical 
        training if the district transports the nonpublic students.  
        Each nonpublic school shall provide the instruction. 
           (c) Student school bus safety training shall commence 
        during school bus safety week.  All students enrolled in grades 
        kindergarten through 3 who are transported by school bus and are 
        enrolled during the first or second week of school must 
        demonstrate achievement of the school bus safety training 
        competencies by the end of the third week of school.  All 
        students enrolled in grades 4 through 10 who are transported by 
        school bus and are enrolled during the first or second week of 
        school must demonstrate achievement of the competencies by the 
        end of the sixth week of school.  Students enrolled in grades 
        kindergarten through 10 who enroll in a school after the second 
        week of school and are transported by school bus shall undergo 
        school bus safety training and demonstrate achievement of the 
        school bus safety competencies within four weeks of the first 
        day of attendance.  The pupil transportation safety director in 
        each district must certify to the commissioner of children, 
        families, and learning annually that all students transported by 
        school bus within the district have satisfactorily demonstrated 
        knowledge and understanding of the school bus safety 
        competencies according to this section or provide an explanation 
        for a student's failure to demonstrate the competencies.  The 
        principal or other chief administrator of each nonpublic school 
        must certify annually to the public transportation safety 
        director of the district in which the school is located that all 
        of the school's students transported by school bus at public 
        expense have received training.  A school district may deny 
        transportation to a student who fails to demonstrate the 
        competencies, unless the student is unable to achieve the 
        competencies due to a disability, or to a student who attends a 
        nonpublic school that fails to provide training as required by 
        this subdivision. 
           (d) A school district and a nonpublic school with students 
        transported by school bus at public expense must, to the extent 
        possible, provide kindergarten pupils with bus safety training 
        before the first day of school. 
           (e) A school district and a nonpublic school with students 
        transported by school bus at public expense must also provide 
        student safety education for bicycling and pedestrian safety, 
        for students enrolled in grades kindergarten through 5. 
           (f) A school district and a nonpublic school with students 
        transported by school bus at public expense must make reasonable 
        accommodations for the school bus, bicycle, and pedestrian 
        safety training of pupils known to speak English as a second 
        language and pupils with disabilities. 
           Sec. 5.  Minnesota Statutes 1996, section 169.01, 
        subdivision 6, is amended to read: 
           Subd. 6.  [SCHOOL BUS.] "School bus" means a motor vehicle 
        used to transport pupils to or from a school defined in section 
        120.101, or to or from school-related activities, by the school 
        or a school district, or by someone under an agreement with the 
        school or a school district.  A school bus does not include a 
        motor vehicle transporting children to or from school for which 
        parents or guardians receive direct compensation from a school 
        district, a motor coach operating under charter carrier 
        authority, a transit bus providing services as defined in 
        section 174.22, subdivision 7, or a vehicle otherwise qualifying 
        as a type III vehicle under paragraph (5), when the vehicle is 
        properly registered and insured and being driven by an employee 
        or agent of a school district for nonscheduled transportation.  
        A school bus may be type A, type B, type C, or type D, or type 
        III as follows:  
           (1) A "type A school bus" is a conversion or body 
        constructed upon a van-type compact truck or a front-section 
        vehicle, with a gross vehicle weight rating of 10,000 pounds or 
        less or cutaway front section vehicle with a left-side driver's 
        door, designed for carrying more than ten persons.  This 
        definition includes two classifications:  type A-I, with a gross 
        vehicle weight rating (GVWR) over 10,000 pounds; and type A-II, 
        with a GVWR of 10,000 pounds or less. 
           (2) A "type B school bus" is a conversion or body 
        constructed and installed upon a van or front-section vehicle 
        chassis, or stripped chassis, with a gross vehicle weight rating 
        of more than 10,000 pounds, designed for carrying more than ten 
        persons.  Part of the engine is beneath or behind the windshield 
        and beside the driver's seat.  The entrance door is behind the 
        front wheels. 
           (3) A "type C school bus" is a body installed upon a flat 
        back cowl chassis with a gross vehicle weight rating of more 
        than 10,000 pounds, designed for carrying more than ten 
        persons.  All of the engine is in front of the windshield and 
        the entrance door is behind the front wheels. 
           (4) A "type D school bus" is a body installed upon a 
        chassis, with the engine mounted in the front, midship or rear, 
        with a gross vehicle weight rating of more than 10,000 pounds, 
        designed for carrying more than ten persons.  The engine may be 
        behind the windshield and beside the driver's seat; it may be at 
        the rear of the bus, behind the rear wheels, or midship between 
        the front and rear axles.  The entrance door is ahead of the 
        front wheels. 
           (5) Type III school buses and type III Head Start buses are 
        restricted to passenger cars, station wagons, vans, and buses 
        having a maximum manufacturer's rated seating capacity of ten 
        people, including the driver, and a gross vehicle weight rating 
        of 10,000 pounds or less.  In this subdivision, "gross vehicle 
        weight rating" means the value specified by the manufacturer as 
        the loaded weight of a single vehicle.  A "type III school bus" 
        and "type III Head Start bus" must not be outwardly equipped and 
        identified as a type A, B, C, or D school bus or type A, B, C, 
        or D Head Start bus. 
           Sec. 6.  Minnesota Statutes 1996, section 169.435, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SCHOOL BUS SAFETY ADVISORY COMMITTEE.] (a) The 
        commissioner of public safety shall establish the school bus 
        safety advisory committee.  The commissioner shall provide the 
        committee with meeting space and clerical support.  The 
        commissioner of public safety or the commissioner's designee 
        shall chair the committee.  The members of the committee also 
        shall include: 
           (1) the commissioner of children, families, and learning or 
        the commissioner's designee; 
           (2) the commissioner of human rights or the commissioner's 
        designee; 
           (3) a county or city attorney; 
           (4) a representative of the state patrol; 
           (5) a school board member; 
           (6) a school superintendent; 
           (7) two school bus drivers, one representing the 
        metropolitan area and one representing greater Minnesota; 
           (8) two school transportation contractors, one representing 
        the metropolitan areas and one representing greater Minnesota; 
           (9) two school transportation safety directors, one 
        representing the metropolitan area and one representing greater 
        Minnesota; and 
           (10) five public members, including at least four parents 
        of children who ride a school bus, among them a parent of a 
        child with a disability.  The public members shall be 
        geographically representative. 
           The commissioner of public safety, in consultation with the 
        commissioner of children, families, and learning, shall appoint 
        the members listed in clauses (3) to (9).  The governor shall 
        appoint the public members in clause (10).  Terms, compensation, 
        and removal of committee members shall be according to section 
        15.059.  The committee shall meet quarterly or as required by 
        the chair. 
           (b) The duties of the committee shall include: 
           (1) an annual report by January 15 to the governor and the 
        education committees of the legislature, including 
        recommendations for legislative action when needed, on student 
        bus safety education, school bus equipment requirements and 
        inspection, including seat belts and other occupant restraint 
        systems, bus driver licensing, training, and qualifications, bus 
        operation procedures, student behavior and discipline, rules of 
        the road, school bus safety education for the public, or any 
        other aspects of school transportation safety the committee 
        considers appropriate; 
           (2) a quarterly review of all school transportation 
        accidents, crimes, incidents of serious misconduct, incidents 
        that result in serious personal injury or death, and bus driver 
        dismissals for cause; and 
           (3) periodic review of school district comprehensive 
        transportation safety policies. 
           (c) The committee expires June 30, 2001. 
           Sec. 7.  Minnesota Statutes 1996, section 169.443, 
        subdivision 3, is amended to read: 
           Subd. 3.  [WHEN SIGNALS NOT USED.] School bus drivers shall 
        not activate the prewarning flashing amber signals or flashing 
        red signals and shall not use the stop arm signal: 
           (1) in special school bus loading areas where the bus is 
        entirely off the traveled portion of the roadway and where no 
        other motor vehicle traffic is moving or is likely to be moving 
        within 20 feet of the bus; 
           (2) in residence districts or business districts, as 
        defined in section 169.01, of home rule or statutory cities when 
        directed not to do so, in writing, by the local school 
        administrator board; 
           (3) when a school bus is being used on a street or highway 
        for purposes other than the actual transportation of school 
        children to or from school or a school-approved activity, except 
        as provided in subdivision 8; 
           (4) at railroad grade crossings; and 
           (5) when loading and unloading people while the bus is 
        completely off the traveled portion of a separated, one-way 
        roadway that has adequate shoulders.  The driver shall drive the 
        bus completely off the traveled portion of this roadway before 
        loading or unloading people. 
           Sec. 8.  Minnesota Statutes 1996, section 169.447, 
        subdivision 6, is amended to read: 
           Subd. 6.  [OVERHEAD BOOK RACKS; STORAGE COMPARTMENTS.] 
        Types A, B, C, and D School buses may be equipped with padded, 
        permanent overhead book racks that do not hang over the center 
        aisle of the bus.  School buses manufactured after January 1, 
        1998, may also be equipped with interior overhead storage 
        compartments provided they meet the requirements of the 1995 
        "National Standards for School Buses and School Bus Operations." 
           Sec. 9.  Minnesota Statutes 1996, section 169.4501, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [NATIONAL STANDARDS ADOPTED.] Except as 
        provided in sections 169.4502 and 169.4503, the construction, 
        design, equipment, and color of types A, B, C, and D school 
        buses used for the transportation of school children shall meet 
        the requirements of the "bus chassis standards" and "bus body 
        standards" in the 1990 1995 revised edition of the "National 
        Standards for School Buses and School Bus Operations" adopted by 
        the Eleventh Twelfth National Conference on School 
        Transportation and published by the National Safety Council.  
        Except as provided in section 169.4504, the construction, 
        design, and equipment of types A, B, C, and D school buses used 
        for the transportation of students with disabilities also shall 
        meet the requirements of the "specially equipped school bus 
        standards" in the 1990 1995 National Standards for School Buses 
        and School Bus Operations.  The "bus chassis standards," "bus 
        body standards," and "specially equipped school bus standards" 
        sections of the 1990 1995 revised edition of the "National 
        Standards for School Buses and School Bus Operations" are 
        incorporated by reference in this chapter. 
           Sec. 10.  Minnesota Statutes 1996, section 169.4501, 
        subdivision 2, is amended to read: 
           Subd. 2.  [APPLICABILITY.] (a) The standards adopted in 
        this section and sections 169.4502 and 169.4503, govern the 
        construction, design, equipment, and color of school buses used 
        for the transportation of school children, when owned and 
        operated by a school or privately owned and operated under a 
        contract with a school, and these standards must be made a part 
        of that contract by reference.  Each school, its officers and 
        employees, and each person employed under the contract is 
        subject to these standards. 
           (b) The standards apply to school buses manufactured after 
        December 31, 1994 1997.  Buses complying with these standards 
        when manufactured need not comply with standards established 
        later except as specifically provided for by law. 
           (c) A school bus manufactured on or before December 31, 
        1994 1997, must conform to the Minnesota standards in effect on 
        the date the vehicle was manufactured except as specifically 
        provided for in law. 
           (d) A new bus body may be remounted on a used chassis 
        provided that the remounted vehicle meets state and federal 
        standards for new buses which are current at the time of the 
        remounting.  Permission must be obtained from the commissioner 
        of public safety before the remounting is done.  A used bus body 
        may not be remounted on a new or used chassis. 
           Sec. 11.  Minnesota Statutes 1996, section 169.4502, 
        subdivision 2, is amended to read: 
           Subd. 2.  [BRAKES.] The braking system must include an 
        emergency brake.  The braking system must meet federal motor 
        vehicle safety standards in effect at the time of manufacture.  
        All buses manufactured with air brakes after January 1, 1995, 
        shall have automatic slack adjusters. 
           Sec. 12.  Minnesota Statutes 1996, section 169.4502, 
        subdivision 7, is amended to read: 
           Subd. 7.  [EXHAUST SYSTEM.] The tailpipe must: 
           (1) extend to but not more than one inch beyond the bumper 
        and be mounted outside of the chassis frame rail; or 
           (2) extend to but not more than one inch two inches beyond 
        the left side of the bus, behind the driver's compartment.  A 
        type A bus and a type B bus with a gross vehicle weight rating 
        under 15,000 pounds, shall comply with the manufacturer's 
        standard.  No exhaust pipe may exit beneath an emergency exit, 
        or, on a type C or type D bus, under the fuel fill location.  No 
        exhaust pipe shall be reduced in size beyond the muffler. 
           Sec. 13.  Minnesota Statutes 1996, section 169.4502, 
        subdivision 9, is amended to read: 
           Subd. 9.  [FUEL TANK.] If mounted behind the rear wheels, 
        the fuel tank on a vehicle constructed with a power lift unit 
        shall be between the frame rails.  Fuel tanks for a type A bus 
        and for a type B bus with a gross vehicle weight rating under 
        15,000 pounds may must be manufacturer manufacturer's standard 
        and must conform with federal motor vehicle safety standard 
        number 301, Code of Federal Regulations, title 49, part 571. 
           Sec. 14.  Minnesota Statutes 1996, section 169.4502, 
        subdivision 11, is amended to read: 
           Subd. 11.  [TIRES AND RIMS.] The use of multipiece rims or 
        tube-type tires is permitted.  Radial and bias ply tires shall 
        not be used on the same axle.  Front tire tread depth shall not 
        be less than 4/32 inch in any major tire tread groove. Rear tire 
        tread shall not be less than 2/32 inch.  Tires must be measured 
        in three locations around the tire, in two adjoining grooves.  
        No recapped tires shall be used on the front wheels.  Recapped 
        tires are permitted on the rear wheels. 
           Sec. 15.  Minnesota Statutes 1996, section 169.4502, is 
        amended by adding a subdivision to read: 
           Subd. 13.  [AIR CLEANER.] The air intake system for diesel 
        buses may have an air cleaner restriction indicator installed. 
           Sec. 16.  Minnesota Statutes 1996, section 169.4502, is 
        amended by adding a subdivision to read: 
           Subd. 14.  [CLUTCH.] A starter interlock may be installed 
        to prevent actuation of the starter if the clutch is not 
        depressed. 
           Sec. 17.  Minnesota Statutes 1996, section 169.4502, is 
        amended by adding a subdivision to read: 
           Subd. 15.  [OIL FILTER.] An oil filtration system may be 
        used in lieu of an oil filter. 
           Sec. 18.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [RELATION TO NATIONAL STANDARDS.] The bus 
        body standards contained in this section are required in 
        addition to those required by sections 169.450 169.4501 and 
        169.4502.  When a Minnesota standard contained in this section 
        conflicts with a national standard adopted in section 169.450 
        169.4501, the Minnesota standard contained in this section is 
        controlling. 
           Sec. 19.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 2, is amended to read: 
           Subd. 2.  [BACKUP WARNING ALARM.] An automatic audible 
        backup alarm may be installed.  A spring-loaded button in the 
        driver's compartment that will temporarily disable the backup 
        alarm is allowed for usage in school bus overnight parking lots 
        and repair facilities. 
           Sec. 20.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 10, is amended to read: 
           Subd. 10.  [EMERGENCY EQUIPMENT; FIRE EXTINGUISHERS.] The 
        fire extinguisher must have at least a 10BC rating The bus must 
        be equipped with at least one UL-approved pressurized, dry 
        chemical fire extinguisher with a total rating of 2A10BC or 
        greater. 
           Sec. 21.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 13, is amended to read: 
           Subd. 13.  [IDENTIFICATION.] (a) Each bus shall, in the 
        beltline, identify the school district serviced, or company 
        name, or owner of the bus.  Numbers necessary for identification 
        must appear on the sides and rear of the bus.  Symbols or 
        letters may be used on the outside of the bus near the entrance 
        door for student identification.  A manufacturer's nameplate or 
        logo may be placed on the side of the bus near the entrance door 
        and on the rear. 
           (b) Effective December 31, 1994, all buses sold must 
        display lettering "Unlawful to pass when red lights are 
        flashing" on the rear of the bus.  The lettering shall be in 
        two-inch black letters on school bus yellow background.  This 
        message shall be displayed directly below the upper window of 
        the rear door.  On rear engine buses, it shall be centered at 
        approximately the same location.  Only signs and lettering 
        approved or required by state law may be displayed. 
           Sec. 22.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 14, is amended to read: 
           Subd. 14.  [INSULATION.] (a) Ceilings and wall shall be 
        insulated to a minimum of one and one-half inch fiberglass and 
        installed so the insulation does not compact or sag.  Floor 
        insulation must be nominal 19/32 inches thick plywood, or a 
        material of equal or greater strength and insulation R value 
        that equals or exceeds properties of exterior-type softwood 
        plywood, C-D grade as specified in standard issued by the United 
        States Department of Commerce.  Type A and B A-II buses with a 
        gross vehicle weight rating under 15,000 pounds must have a 
        minimum of one-half inch plywood.  All exposed edges on plywood 
        shall be sealed.  Every school bus shall be constructed so that 
        the noise level taken at the ear of the occupant nearest to the 
        primary vehicle noise source shall not exceed 85 dba when tested 
        according to procedures in the 1990 1995 National Standards for 
        School Buses and School Bus Operations. 
           (b) The underside of metal floor may be undercoated with 
        polyurethane floor insulation, foamed in place.  The floor 
        insulation must be combustion resistant.  The authorization in 
        this paragraph does not replace the plywood requirement. 
           Sec. 23.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 17, is amended to read: 
           Subd. 17.  [MIRRORS.] A type B bus with a gross vehicle 
        weight rating less than 15,000 pounds shall have a minimum of 
        six-inch by 16-inch mirror.  A type B bus with a gross vehicle 
        weight rating over 15,000 pounds shall have a minimum of a 
        six-inch by 30-inch mirror.  After January 1, 1995, all school 
        buses must be equipped with a minimum of two crossover mirrors, 
        mounted to the left and right sides of the bus. 
           Sec. 24.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 19, is amended to read: 
           Subd. 19.  [RUB RAILS.] There shall be one rub rail at the 
        base of the skirt of the bus on all type A, excluding van 
        conversions, B, C, and D buses. 
           Sec. 25.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 23, is amended to read: 
           Subd. 23.  [WINDOWS.] Windshield, entrance, and rear 
        emergency exit doors must be of approved safety glass.  
        Laminated or tempered glass (AS-2 or AS-3) is permitted in all 
        other windows.  All glass shall be federally approved and marked 
        as provided in section 169.74.  The windshield may be of uniform 
        tint throughout or may have a horizontal gradient band starting 
        slightly above the line of vision and gradually decreasing in 
        light transmission to 20 percent or less at the top of the 
        windshield.  The use of tinted glass, as approved by section 
        169.71, is permitted on side windows and rear windows except for 
        the entrance door, the first window behind the service door, and 
        the window to the left of the driver.  The window to the left of 
        the driver, the upper service door windows, and the window 
        immediately behind the entrance door must be thermal glass.  The 
        window to the left of the driver for type A and B buses with a 
        gross vehicle weight rating under 15,000 pounds need not be 
        thermal glass. 
           Sec. 26.  Minnesota Statutes 1996, section 169.4503, 
        subdivision 24, is amended to read: 
           Subd. 24.  [WIRING.] If not protected by a grommet, wire 
        that passes through holes shall be encased in an 
        abrasive-resistant protective covering.  If a master cutoff 
        switch is used, it shall not be wired as to kill power to the 
        electric brake system. 
           Sec. 27.  Minnesota Statutes 1996, section 169.4503, is 
        amended by adding a subdivision to read: 
           Subd. 25.  [DRIVER COMPARTMENT.] The driver's seat must be 
        a high-back seat. 
           Sec. 28.  Minnesota Statutes 1996, section 169.4504, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [RELATION TO NATIONAL STANDARDS.] The 
        specially equipped school bus standards contained in this 
        section are required in addition to those required by section 
        169.450 169.4501.  When a Minnesota standard contained in this 
        section conflicts with a national standard adopted in 
        section 169.450 169.4501, the Minnesota standard contained in 
        this section is controlling. 
           Sec. 29.  Minnesota Statutes 1996, section 169.4504, is 
        amended by adding a subdivision to read: 
           Subd. 6.  [SECUREMENT AND RESTRAINT SYSTEM.] The securement 
        and restraint system must be located and installed so that when 
        an occupied wheelchair or other mobility aid is secured, the 
        installation meets the requirements of the applicable federal 
        motor vehicle safety standard. 
           Sec. 30.  Minnesota Statutes 1996, section 169.452, is 
        amended to read: 
           169.452 [ACCIDENT AND SERIOUS INCIDENT REPORTING.] 
           The department of public safety shall develop uniform 
        definitions of a school bus accident, an incident of serious 
        misconduct, and an incident that results in personal injury or 
        death.  The department shall determine what type of information 
        on school bus accidents and incidents, including criminal 
        conduct, and bus driver dismissals for cause should be collected 
        and develop a uniform accident and incident reporting form to 
        collect those data, including data relating to type III 
        vehicles, statewide.  In addition to the form, the department 
        shall have an alternative method of reporting that allows school 
        districts to use computer technology to provide the required 
        information.  School districts selected by the commissioner 
        shall report the information required by the department using 
        either format.  A school district must not be charged for 
        reporting forms or reporting procedures under this section.  
        Data collected under this section shall be analyzed to help 
        develop accident, crime, and misconduct prevention programs.  
        This section is not subject to chapter 14. 
           Sec. 31.  Minnesota Statutes 1996, section 171.321, 
        subdivision 3, is amended to read: 
           Subd. 3.  [STUDY OF APPLICANT.] (a) Before issuing or 
        renewing a school bus endorsement, the commissioner shall 
        conduct a criminal and driver's license records check of the 
        applicant.  The commissioner may also conduct the check at any 
        time while a person is so licensed.  The check shall consist of 
        a criminal records check of the state criminal records 
        repository and a check of the driver's license records system.  
        If the applicant has resided in Minnesota for less than five 
        years, the check shall also include a criminal records check of 
        information from the state law enforcement agencies in the 
        states where the person resided during the five years before 
        moving to Minnesota, and of the national criminal records 
        repository including the criminal justice data communications 
        network.  The applicant's failure to cooperate with the 
        commissioner in conducting the records check is reasonable cause 
        to deny an application or cancel a school bus endorsement.  The 
        commissioner may not release the results of the records check to 
        any person except the applicant. 
           (b) The commissioner may issue to an otherwise qualified 
        applicant a temporary school bus endorsement, effective for no 
        more than 120 180 days, upon presentation of (1) an affidavit by 
        the applicant that the applicant has not been convicted of a 
        disqualifying offense and (2) a criminal history check from each 
        state of residence for the previous five years.  The criminal 
        history check may be conducted and prepared by any public or 
        private source acceptable to the commissioner.  The commissioner 
        may reissue the temporary endorsement if the National Criminal 
        Records Repository check is timely submitted but not completed 
        within the 180-day period. 
           Sec. 32.  Minnesota Statutes 1996, section 171.3215, 
        subdivision 4, is amended to read: 
           Subd. 4.  [WAIVER OF PERMANENT CANCELLATION.] The 
        commissioner of public safety or the commissioner's designee, in 
        consultation with the school bus safety advisory committee 
        division of driver and vehicle services, may waive the permanent 
        cancellation requirement of section 171.3215 for a person 
        convicted of a nonfelony violation of chapter 152 or a felony 
        that is not a violent crime under section 609.152. 
           Sec. 33.  [APPROPRIATIONS.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES AND 
        LEARNING.] The sums indicated in this section are appropriated 
        from the general fund to the department of children, families, 
        and learning for the fiscal years designated. 
           Subd. 2.  [LEARNING READINESS; HEAD START PROGRAMS; 
        ECFE.] For learning readiness programs; Head Start programs; and 
        early childhood family education programs: 
             $2,500,000      .....     1998
             $2,500,000      .....     1999
           Of this amount, one-third shall be allocated to each 
        program.  This appropriation shall be proportionally reduced if 
        the revenue in any year under Minnesota Statutes 1996, section 
        121.175, is less than the appropriation.  The commissioner may 
        also use part of the appropriation to reimburse districts that 
        can demonstrate it incurred excess costs in implementing 
        Minnesota Statutes 1996, section 121.175. 
           Sec. 34.  [REPEALER.] 
           Minnesota Statutes 1996, sections 169.4502, subdivision 6; 
        169.4503, subdivisions 3, 8, 9, 11, 12, and 22; and 169.454, 
        subdivision 11, are repealed. 
           Sec. 35.  [EFFECTIVE DATE.] 
           If this act is enacted on or after July 1, 1997, sections 1 
        to 34 are effective the day following final enactment. 
                                   ARTICLE 13
                            TAX DEDUCTION AND CREDIT
           Section 1.  Minnesota Statutes 1996, section 290.01, 
        subdivision 19b, is amended to read: 
           Subd. 19b.  [SUBTRACTIONS FROM FEDERAL TAXABLE INCOME.] For 
        individuals, estates, and trusts, there shall be subtracted from 
        federal taxable income: 
           (1) interest income on obligations of any authority, 
        commission, or instrumentality of the United States to the 
        extent includable in taxable income for federal income tax 
        purposes but exempt from state income tax under the laws of the 
        United States; 
           (2) if included in federal taxable income, the amount of 
        any overpayment of income tax to Minnesota or to any other 
        state, for any previous taxable year, whether the amount is 
        received as a refund or as a credit to another taxable year's 
        income tax liability; 
           (3) the amount paid to others, less the credit allowed 
        under section 290.0674, not to exceed $650 $1,625 for each 
        dependent in grades kindergarten to 6 and $1,000 $2,500 for each 
        dependent in grades 7 to 12, for tuition, textbooks, and 
        transportation of each dependent in attending an elementary or 
        secondary school situated in Minnesota, North Dakota, South 
        Dakota, Iowa, or Wisconsin, wherein a resident of this state may 
        legally fulfill the state's compulsory attendance laws, which is 
        not operated for profit, and which adheres to the provisions of 
        the Civil Rights Act of 1964 and chapter 363.  For the purposes 
        of this clause, "tuition" includes fees or tuition as defined in 
        section 290.0674, subdivision 1, clause (1).  As used in this 
        clause, "textbooks" includes books and other instructional 
        materials and equipment used in elementary and secondary schools 
        in teaching only those subjects legally and commonly taught in 
        public elementary and secondary schools in this 
        state.  Equipment expenses qualifying for deduction includes 
        expenses as defined and limited in section 290.0674, subdivision 
        1, clause (3).  "Textbooks" does not include instructional books 
        and materials used in the teaching of religious tenets, 
        doctrines, or worship, the purpose of which is to instill such 
        tenets, doctrines, or worship, nor does it include books or 
        materials for, or transportation to, extracurricular activities 
        including sporting events, musical or dramatic events, speech 
        activities, driver's education, or similar programs.  In order 
        to qualify for the subtraction under this clause the taxpayer 
        must elect to itemize deductions under section 63(e) of the 
        Internal Revenue Code; 
           (4) to the extent included in federal taxable income, 
        distributions from a qualified governmental pension plan, an 
        individual retirement account, simplified employee pension, or 
        qualified plan covering a self-employed person that represent a 
        return of contributions that were included in Minnesota gross 
        income in the taxable year for which the contributions were made 
        but were deducted or were not included in the computation of 
        federal adjusted gross income.  The distribution shall be 
        allocated first to return of contributions until the 
        contributions included in Minnesota gross income have been 
        exhausted.  This subtraction applies only to contributions made 
        in a taxable year prior to 1985; 
           (5) income as provided under section 290.0802; 
           (6) the amount of unrecovered accelerated cost recovery 
        system deductions allowed under subdivision 19g; 
           (7) to the extent included in federal adjusted gross 
        income, income realized on disposition of property exempt from 
        tax under section 290.491; 
           (8) to the extent not deducted in determining federal 
        taxable income, the amount paid for health insurance of 
        self-employed individuals as determined under section 162(l) of 
        the Internal Revenue Code, except that the 25 percent limit does 
        not apply.  If the taxpayer deducted insurance payments under 
        section 213 of the Internal Revenue Code of 1986, the 
        subtraction under this clause must be reduced by the lesser of: 
           (i) the total itemized deductions allowed under section 
        63(d) of the Internal Revenue Code, less state, local, and 
        foreign income taxes deductible under section 164 of the 
        Internal Revenue Code and the standard deduction under section 
        63(c) of the Internal Revenue Code; or 
           (ii) the lesser of (A) the amount of insurance qualifying 
        as "medical care" under section 213(d) of the Internal Revenue 
        Code to the extent not deducted under section 162(1) of the 
        Internal Revenue Code or excluded from income or (B) the total 
        amount deductible for medical care under section 213(a); and 
           (9) the exemption amount allowed under Laws 1995, chapter 
        255, article 3, section 2, subdivision 3. 
           Sec. 2.  Minnesota Statutes 1996, section 290.0671, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [CREDIT ALLOWED.] An individual is allowed 
        a credit against the tax imposed by this chapter equal to 15 
        percent a percentage of the credit for which the individual is 
        eligible under section 32 of the Internal Revenue Code.  The 
        percentage is 15 for individuals without a qualifying child, and 
        25 for individuals with at least one qualifying child.  For 
        purposes of this section, "qualifying child" has the meaning 
        given in section 32(c)(3) of the Internal Revenue Code. 
           For a nonresident or part-year resident, the credit 
        determined under section 32 of the Internal Revenue Code must be 
        allocated based on the percentage calculated under section 
        290.06, subdivision 2c, paragraph (e). 
           For a person who was a resident for the entire tax year and 
        has earned income not subject to tax under this chapter, the 
        credit must be allocated based on the ratio of federal adjusted 
        gross income reduced by the earned income not subject to tax 
        under this chapter over federal adjusted gross income. 
           Sec. 3.  [290.0674] [MINNESOTA EDUCATION CREDIT.] 
           Subdivision 1.  [CREDIT ALLOWED.] An individual is allowed 
        a credit against the tax imposed by this chapter in an amount 
        equal to the amount paid for education-related expenses for a 
        dependent in kindergarten through grade 12.  For purposes of 
        this section, "education-related expenses" means: 
           (1) fees or tuition for instruction by an instructor under 
        section 120.101, subdivision 7, clause (1), (2), (3), (4), or 
        (5), for instruction outside the regular school day or school 
        year, including tutoring, driver's education taken as part of 
        school curriculum, or summer camps, in grade or age appropriate 
        curricula that supplement curricula and instruction available 
        during the regular school year, that assists a dependent to 
        improve knowledge of core curriculum areas or to expand 
        knowledge and skills under the graduation rule under section 
        121.11, subdivision 7c, and that do not include the teaching of 
        religious tenets, doctrines, or worship, the purpose of which is 
        to instill such tenets, doctrines, or worship; 
           (2) expenses for textbooks, including books and other 
        instructional materials and equipment used in elementary and 
        secondary schools in teaching only those subjects legally and 
        commonly taught in public elementary and secondary schools in 
        this state.  "Textbooks" does not include instructional books 
        and materials used in the teaching of religious tenets, 
        doctrines, or worship, the purpose of which is to instill such 
        tenets, doctrines, or worship, nor does it include books or 
        materials for extracurricular activities including sporting 
        events, musical or dramatic events, speech activities, driver's 
        education, or similar programs; 
           (3) a maximum expense of $200 per family for personal 
        computer hardware, excluding single purpose processors, and 
        educational software that assists a dependent to improve 
        knowledge of core curriculum areas or to expand knowledge and 
        skills under the graduation rule under section 121.11, 
        subdivision 7c, purchased for use in the taxpayer's home and not 
        used in a trade or business regardless of whether the computer 
        is required by the dependent's school; and 
           (4) the amount paid to others for transportation of a 
        dependent attending an elementary or secondary school situated 
        in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, 
        wherein a resident of this state may legally fulfill the state's 
        compulsory attendance laws, which is not operated for profit, 
        and which adheres to the provisions of the Civil Rights Act of 
        1964 and chapter 363. 
           Subd. 2.  [LIMITATIONS.] (a) For claimants with income not 
        greater than $33,500, the maximum credit allowed is $1,000 per 
        child and $2,000 per family.  No credit is allowed for 
        education-related expenses for claimants with income greater 
        than $33,500.  For purposes of this section "income" has the 
        meaning given in section 290.067, subdivision 2a.  In the case 
        of a married claimant, a credit is not allowed unless a joint 
        income tax return is filed. 
           (b) For a nonresident or part-year resident, the credit 
        determined under subdivision 1 and the maximum credit amount in 
        paragraph (a) must be allocated using the percentage calculated 
        in section 290.06, subdivision 2c, paragraph (e). 
           Subd. 3.  [REDUCTION BY ALTERNATIVE MINIMUM TAX LIABILITY.] 
        The amount of the credit allowed must be reduced by the amount 
        of the taxpayer's liability under section 290.091, determined 
        before the credit allowed by this section is subtracted from 
        regular tax liability. 
           Subd. 4.  [CREDIT TO BE REFUNDABLE.] If the amount of 
        credit that the claimant is eligible to receive under this 
        section exceeds the claimant's tax liability under this chapter, 
        the commissioner shall refund the excess to the claimant. 
           Subd. 5.  [APPROPRIATION.] An amount sufficient to pay the 
        refunds required by this section is appropriated to the 
        commissioner from the general fund. 
           Sec. 4.  [SEVERABILITY CLAUSE.] 
           If a court of competent jurisdiction enjoins the 
        implementing of any provision in this article or finds any 
        provision in this article unconstitutional, the remaining 
        sections in this article and the remaining articles in this act 
        shall remain valid and shall be given full effect. 
           Sec. 5.  [EFFECTIVE DATE.] 
           Subdivision 1.  [CONTINGENCY.] This article is effective 
        for tax years beginning after December 31, 1997, if on the basis 
        of the November 1997 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 after taking into account the costs 
        of sections 1 to 3 and after meeting the requirements of 
        Minnesota Statutes, section 16A.152, subdivision 2, clause (a). 
           Subd. 2.  [SUSPENSION.] Minnesota Statutes, section 
        16A.152, subdivision 2, clauses (b) and (c), are not to be 
        implemented for the forecast of general fund revenues and 
        expenditures in November 1997 until sections 1 to 3 are 
        implemented.  However, if the November 1997 forecast does not 
        provide an unrestricted general fund balance adequate to 
        implement sections 1 to 3, the provisions of Minnesota Statutes, 
        section 16A.152, subdivision 2, clauses (b) and (c), are 
        effective. 
           Presented to the governor June 27, 1997 
           Signed by the governor June 30, 1997, 1:33 p.m.

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