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2001 Minnesota Session Laws

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                              CHAPTER 6-H.F.No. 2 
                  An act relating to education; providing for 
                  kindergarten through grade 12 education including 
                  general education revenue; education excellence; 
                  special programs; facilities and technology; 
                  nutrition, school accounting, and other programs; 
                  deficiencies; state agencies; and technical 
                  amendments; appropriating money; amending Minnesota 
                  Statutes 2000, sections 16B.616, subdivision 4; 93.22; 
                  120B.07; 120B.13, subdivision 1; 120B.30, subdivision 
                  1; 120B.35; 121A.41, subdivision 10; 121A.582; 
                  122A.162; 122A.163; 122A.18, subdivisions 1, 2, 4; 
                  122A.20, subdivision 2; 122A.21; 122A.24, subdivision 
                  3; 122A.25, by adding a subdivision; 122A.26, 
                  subdivision 3; 122A.31; 122A.40, subdivision 7, by 
                  adding a subdivision; 122A.41, subdivisions 4, 7, 13, 
                  by adding subdivisions; 122A.61, subdivision 1; 
                  123B.03, subdivision 3; 123B.143, subdivision 1; 
                  123B.36, subdivision 1; 123B.37, subdivision 1; 
                  123B.42, subdivision 3; 123B.44, subdivision 6; 
                  123B.54; 123B.57, subdivisions 3, 6, 8; 123B.59, 
                  subdivision 1; 123B.71, subdivisions 1, 4, 8, 9; 
                  123B.75, subdivision 5, by adding a subdivision; 
                  123B.80, subdivision 1; 123B.88, subdivision 1; 
                  124D.03, subdivision 4; 124D.10, subdivisions 4, 8, 
                  15, by adding subdivisions; 124D.11, subdivisions 4, 
                  5, 9; 124D.128, subdivisions 1, 2, 3, 6, by adding a 
                  subdivision; 124D.454, subdivision 11; 124D.59, 
                  subdivision 2; 124D.65, subdivision 5; 124D.69, 
                  subdivision 1; 124D.74, subdivisions 1, 2, 3, 4, 6; 
                  124D.75, subdivision 6; 124D.76; 124D.78, subdivision 
                  1; 124D.81, subdivisions 1, 3, 5, 6, 7; 124D.84, 
                  subdivision 1; 124D.86, subdivision 3; 124D.892, 
                  subdivisions 1, 3, as amended; 124D.894; 125A.023, 
                  subdivision 4; 125A.027, by adding a subdivision; 
                  125A.08; 125A.09, subdivision 3; 125A.11, subdivision 
                  3; 125A.17; 125A.27, subdivision 15; 125A.515; 
                  125A.76, subdivisions 1, 2; 125B.21; 125B.25, 
                  subdivisions 1, 2, 6; 126C.05, subdivisions 1, 15, by 
                  adding a subdivision; 126C.10, subdivisions 1, 2, 4, 
                  9, 13, 24, 25; 126C.12, subdivisions 2, 3, 4, 5, by 
                  adding a subdivision; 126C.15, subdivisions 1, 2, 5; 
                  126C.17, subdivisions 6, 9, 10, 11; 126C.23, 
                  subdivision 5; 126C.40, subdivision 1; 126C.41, 
                  subdivisions 2, 3; 126C.43, subdivision 3; 126C.63, 
                  subdivision 8; 126C.69, subdivisions 2, 9; 127A.41, 
                  subdivisions 5, 8, 9; 127A.42; 127A.45, subdivisions 
                  9, 11, 12, by adding a subdivision; 127A.50, 
                  subdivision 2; 127A.51; 129C.10, subdivision 3; 
                  171.02, subdivision 2a; 179A.20, by adding a 
                  subdivision; 260A.01; 260C.163, subdivision 11; 
                  475.61, subdivision 3; 626.556, subdivision 2; Laws 
                  1992, chapter 499, article 7, section 31, as amended; 
                  Laws 2000, chapter 489, article 2, section 34; Laws 
                  2000, chapter 489, article 2, section 36; Laws 2000, 
                  chapter 489, article 2, section 37, subdivision 3; 
                  Laws 2000, chapter 489, article 2, section 39, 
                  subdivision 2; Laws 2000, chapter 489, article 3, 
                  section 24; Laws 2000, chapter 489, article 3, section 
                  25, subdivision 5; Laws 2000, chapter 489, article 5, 
                  section 21; Laws 2000, chapter 489, article 7, section 
                  15, subdivision 3; proposing coding for new law in 
                  Minnesota Statutes, chapters 93; 120A; 120B; 122A; 
                  124D; 126C; repealing Minnesota Statutes 2000, 
                  sections 123B.71, subdivisions 3, 10; 124D.07; 
                  124D.1155; 124D.128, subdivision 7; 124D.32; 124D.85; 
                  126C.01, subdivision 10; 126C.10, subdivisions 12, 23; 
                  126C.16, subdivision 2; 126C.17, subdivision 12; 
                  126C.18; 126C.22; 126C.30; 126C.31; 126C.32; 126C.33; 
                  126C.34; 126C.35; 126C.36; 126C.42, subdivisions 2, 3; 
                  126C.47; 127A.44; 135A.081; Laws 2000, chapter 254, 
                  section 30; Laws 2000, chapter 489, article 1, section 
                  18; Minnesota Rules, part 3501.0280, subpart 3. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                   ARTICLE 1
                           GENERAL EDUCATION REVENUE
           Section 1.  Minnesota Statutes 2000, section 93.22, is 
        amended to read: 
           93.22 [DISPOSITION OF PAYMENTS.] 
           Subdivision 1.  [GENERALLY.] (a) All payments under 
        sections 93.14 to 93.285 shall be made to the department of 
        natural resources and shall be credited as follows: according to 
        this section.  
           (1) (a) If the lands or minerals and mineral rights covered 
        by a lease are held by the state by virtue of an act of 
        Congress, payments made under the lease shall be credited to the 
        permanent fund of the class of land to which the leased premises 
        belong;. 
           (2) (b) If a lease covers the bed of navigable waters, 
        payments made under the lease shall be credited to the permanent 
        school fund of the state; and. 
           (3) (c) If the lands or minerals and mineral rights covered 
        by a lease are held by the state in trust for the taxing 
        districts, payments made under the lease shall be distributed 
        annually on the first day of September as follows: 
           (i) (1) 20 percent to the general fund; and 
           (ii) (2) 80 percent to the respective counties in which the 
        lands lie, to be apportioned among the taxing districts 
        interested therein as follows:  county, three-ninths; town or 
        city, two-ninths; and school district, four-ninths. 
           (b) (d) Except as provided under paragraph (a) this section 
        and except where the disposition of payments may be otherwise 
        directed by law, all payments shall be paid into the general 
        fund of the state. 
           Subd. 2.  [TACONITE LEASE REVENUE.] Notwithstanding 
        subdivision 1, from July 1, 2001, to June 30, 2006, payments 
        made under state taconite leases shall be distributed as follows:
           (1) if the lands or minerals and mineral rights covered by 
        a lease are held by the state by virtue of a school, swamp, or 
        internal improvement land grant of Congress, payments made under 
        the lease shall be distributed annually on September 1 to the 
        school fund mineral lease suspense account created under section 
        93.223, subdivision 1; and 
           (2) if the lands or minerals and mineral rights covered by 
        a lease are held by the state by virtue of a university land 
        grant of Congress, payments made under the lease shall be 
        distributed annually on September 1 to the university mineral 
        lease suspense account created under section 93.223, subdivision 
        2. 
           Sec. 2.  [93.223] [MINERAL LEASE SUSPENSE ACCOUNTS.] 
           Subdivision 1.  [SCHOOL FUND MINERAL LEASE SUSPENSE 
        ACCOUNT.] The school fund mineral lease suspense account is 
        created as an account in the state treasury for mineral lease 
        money deposited according to section 93.22, subdivision 2, 
        clause (1).  Interest earned on money in the account accrues to 
        the account.  After money is annually deposited in the account 
        under section 93.22, subdivision 2, clause (1), the commissioner 
        of finance shall certify 20 percent of the payments made during 
        the preceding fiscal year as costs for the administration and 
        management of mineral leases on permanent school fund lands.  
        The commissioner of finance shall transfer the certified amount 
        from the school fund mineral lease suspense account to the 
        general fund.  The balance remaining in the account after the 
        certification is annually transferred to the permanent school 
        fund. 
           Subd. 2.  [UNIVERSITY FUND MINERAL LEASE SUSPENSE ACCOUNT.] 
        The university fund mineral lease suspense account is created as 
        an account in the state treasury for mineral lease money 
        deposited according to section 93.22, subdivision 2, clause (2). 
        Interest earned on money in the account accrues to the account.  
        After money is annually deposited in the account under section 
        93.22, subdivision 2, clause (2), the commissioner of finance 
        shall certify 20 percent of the payments made during the 
        preceding fiscal year as costs for the administration and 
        management of mineral leases on permanent university fund 
        lands.  The commissioner of finance shall transfer the certified 
        amount from the university fund mineral lease account to the 
        general fund.  The balance remaining in the account is annually 
        transferred to the permanent university fund. 
           Sec. 3.  [93.2235] [TACONITE MINING GRANTS; 
        APPROPRIATIONS.] 
           Subdivision 1.  [COMMISSIONER.] The commissioner shall 
        establish a program to award grants to taconite mining companies 
        for: 
           (1) taconite pellet product improvements; 
           (2) value-added production of taconite iron ore; or 
           (3) cost-savings production improvements at Minnesota 
        taconite plants. 
           An amount equal to the sum of money transferred to the 
        general fund under section 93.223, subdivision 1, is annually 
        appropriated from the general fund to the commissioner for the 
        purposes of this section. 
           Subd. 2.  [COLERAINE LABORATORY.] The director of the 
        Coleraine laboratory shall establish a program to award grants 
        for the purpose of transferring technology from the Coleraine 
        laboratory to taconite mining companies for: 
           (1) taconite pellet product improvements; 
           (2) value-added production of taconite iron ore; or 
           (3) cost-savings production improvements at Minnesota 
        taconite plants.  
           An amount equal to the sum of money transferred to the 
        general fund under section 92.223, subdivision 2, is annually 
        appropriated from the general fund to the board of regents of 
        the University of Minnesota for the purposes of this section. 
           Sec. 4.  Minnesota Statutes 2000, section 120B.07, is 
        amended to read: 
           120B.07 [EARLY GRADUATION.] 
           Notwithstanding any law to the contrary, any secondary 
        school student who has completed all required courses or 
        standards may, with the approval of the student, the student's 
        parent or guardian, and local school officials, graduate before 
        the completion of the school year.  General education revenue 
        attributable to the student must be paid as though the student 
        was in attendance for the entire year. 
           Sec. 5.  Minnesota Statutes 2000, section 123B.143, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [CONTRACT; DUTIES.] All districts 
        maintaining a classified secondary school must employ a 
        superintendent who shall be an ex officio nonvoting member of 
        the school board.  The authority for selection and employment of 
        a superintendent must be vested in the board in all cases.  An 
        individual employed by a board as a superintendent shall have an 
        initial employment contract for a period of time no longer than 
        three years from the date of employment.  Any subsequent 
        employment contract must not exceed a period of three years.  A 
        board, at its discretion, may or may not renew an employment 
        contract.  A board must not, by action or inaction, extend the 
        duration of an existing employment contract.  Beginning 365 days 
        prior to the expiration date of an existing employment contract, 
        a board may negotiate and enter into a subsequent employment 
        contract to take effect upon the expiration of the existing 
        contract.  A subsequent contract must be contingent upon the 
        employee completing the terms of an existing contract.  If a 
        contract between a board and a superintendent is terminated 
        prior to the date specified in the contract, the board may not 
        enter into another superintendent contract with that same 
        individual that has a term that extends beyond the date 
        specified in the terminated contract.  A board may terminate a 
        superintendent during the term of an employment contract for any 
        of the grounds specified in section 122A.40, subdivision 9 or 13.
        A superintendent shall not rely upon an employment contract with 
        a board to assert any other continuing contract rights in the 
        position of superintendent under section 122A.40.  
        Notwithstanding the provisions of sections 122A.40, subdivision 
        10 or 11, 123A.32, 123A.75, or any other law to the contrary, no 
        individual shall have a right to employment as a superintendent 
        based on order of employment in any district.  If two or more 
        districts enter into an agreement for the purchase or sharing of 
        the services of a superintendent, the contracting districts have 
        the absolute right to select one of the individuals employed to 
        serve as superintendent in one of the contracting districts and 
        no individual has a right to employment as the superintendent to 
        provide all or part of the services based on order of employment 
        in a contracting district. The superintendent of a district 
        shall perform the following:  
           (1) visit and supervise the schools in the district, report 
        and make recommendations about their condition when advisable or 
        on request by the board; 
           (2) recommend to the board employment and dismissal of 
        teachers; 
           (3) superintend school grading practices and examinations 
        for promotions; 
           (4) make reports required by the commissioner; 
           (5) by January 10, submit an annual report to the 
        commissioner in a manner prescribed by the commissioner, in 
        consultation with school districts, identifying the expenditures 
        that the district requires to ensure an 80 percent and a 90 
        percent student passage rate on the basic standards test taken 
        in the eighth grade, identifying the highest student passage 
        rate the district expects it will be able to attain on the basic 
        standards test by grade 12, the amount of expenditures that the 
        district requires to ensure a 99 percent attain the targeted 
        student passage rate on the basic standards test by 12th grade, 
        and how much the district is cross-subsidizing programs with 
        special education, basic skills, and general education revenue; 
        and 
           (6) perform other duties prescribed by the board. 
           Sec. 6.  Minnesota Statutes 2000, section 123B.36, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [SCHOOL BOARDS MAY REQUIRE FEES.] (a) For 
        purposes of this subdivision, "home school" means a home school 
        as defined in sections 120A.22 and 120A.24 with five or fewer 
        students receiving instruction.  
           (b) A school board is authorized to require payment of fees 
        in the following areas: 
           (1) in any program where the resultant product, in excess 
        of minimum requirements and at the pupil's option, becomes the 
        personal property of the pupil; 
           (2) admission fees or charges for extra curricular 
        activities, where attendance is optional and where the admission 
        fees or charges a student must pay to attend or participate in 
        an extracurricular activity is the same for all students, 
        regardless of whether the student is enrolled in a public or a 
        home school; 
           (3) a security deposit for the return of materials, 
        supplies, or equipment; 
           (4) personal physical education and athletic equipment and 
        apparel, although any pupil may personally provide it if it 
        meets reasonable requirements and standards relating to health 
        and safety established by the board; 
           (5) items of personal use or products that a student has an 
        option to purchase such as student publications, class rings, 
        annuals, and graduation announcements; 
           (6) fees specifically permitted by any other statute, 
        including but not limited to section 171.05, subdivision 2; 
        provided (i) driver education fees do not exceed the actual cost 
        to the school and school district of providing driver education, 
        and (ii) the driver education courses are open to enrollment to 
        persons between the ages of 15 and 18 who reside or attend 
        school in the school district; 
           (7) field trips considered supplementary to a district 
        educational program; 
           (8) any authorized voluntary student health and accident 
        benefit plan; 
           (9) for the use of musical instruments owned or rented by 
        the district, a reasonable rental fee not to exceed either the 
        rental cost to the district or the annual depreciation plus the 
        actual annual maintenance cost for each instrument; 
           (10) transportation of pupils to and from extra curricular 
        activities conducted at locations other than school, where 
        attendance is optional; 
           (11) transportation to and from school of pupils to and 
        living within two miles from school for which aid for fiscal 
        year 1996 is not authorized under Minnesota Statutes 1994, 
        section 124.223, subdivision 1, and for which levy for fiscal 
        year 1996 is not authorized under Minnesota Statutes 1994, 
        section 124.226, subdivision 5, and all other transportation 
        services not required by law.  If a district charging charges 
        fees for transportation of pupils establishes, it must establish 
        guidelines for that transportation to ensure that no pupil is 
        denied transportation solely because of inability to pay; 
           (12) motorcycle classroom education courses conducted 
        outside of regular school hours; provided the charge must not 
        exceed the actual cost of these courses to the school district; 
           (13) transportation to and from post-secondary institutions 
        for pupils enrolled under the post-secondary enrollment options 
        program under section 123B.88, subdivision 22.  Fees collected 
        for this service must be reasonable and must be used to reduce 
        the cost of operating the route.  Families who qualify for 
        mileage reimbursement under section 124D.09, subdivision 22, may 
        use their state mileage reimbursement to pay this fee.  If no 
        fee is charged, districts must allocate costs based on the 
        number of pupils riding the route. 
           Sec. 7.  Minnesota Statutes 2000, section 123B.37, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [BOARDS SHALL NOT CHARGE CERTAIN FEES.] (a) 
        A board is not authorized to charge fees in the following areas: 
           (1) textbooks, workbooks, art materials, laboratory 
        supplies, towels; 
           (2) supplies necessary for participation in any 
        instructional course except as authorized in sections 123B.36 
        and 123B.38; 
           (3) field trips that are required as a part of a basic 
        education program or course; 
           (4) graduation caps, gowns, any specific form of dress 
        necessary for any educational program, and diplomas; 
           (5) instructional costs for necessary school personnel 
        employed in any course or educational program required for 
        graduation; 
           (6) library books required to be utilized for any 
        educational course or program; 
           (7) admission fees, dues, or fees for any activity the 
        pupil is required to attend; 
           (8) any admission or examination cost for any required 
        educational course or program; 
           (9) locker rentals; 
           (10) transportation to and from school of pupils (i) for 
        which state transportation aid for fiscal year 1996 is 
        authorized pursuant to Minnesota Statutes 1994, section 124.223, 
        or (ii) for which a levy for fiscal year 1996 is authorized 
        under Minnesota Statutes 1994, section 124.226, subdivision 
        5 living two miles or more from school. 
           (b) Notwithstanding paragraph (a), clauses (1) and (6), a 
        board may charge fees for textbooks, workbooks, and library 
        books, lost or destroyed by students.  The board must annually 
        notify parents or guardians and students about its policy to 
        charge a fee under this paragraph. 
           Sec. 8.  Minnesota Statutes 2000, section 123B.42, 
        subdivision 3, is amended to read: 
           Subd. 3.  [COST; LIMITATION.] (a) The cost per pupil of the 
        textbooks, individualized instructional or cooperative learning 
        materials, and standardized tests provided for in this section 
        for each school year must not exceed the statewide average 
        expenditure per pupil, adjusted pursuant to clause (b), by the 
        Minnesota public elementary and secondary schools for textbooks, 
        individualized instructional materials and standardized tests as 
        computed and established by the department by March February 1 
        of the preceding school year from the most recent public school 
        year data then available. 
           (b) The cost computed in clause (a) shall be increased by 
        an inflation adjustment equal to the percent of increase in the 
        formula allowance, pursuant to section 126C.10, subdivision 2, 
        from the second preceding school year to the current school year.
           (c) The commissioner shall allot to the districts or 
        intermediary service areas the total cost for each school year 
        of providing or loaning the textbooks, individualized 
        instructional or cooperative learning materials, and 
        standardized tests for the pupils in each nonpublic school.  The 
        allotment shall not exceed the product of the statewide average 
        expenditure per pupil, according to clause (a), adjusted 
        pursuant to clause (b), multiplied by the number of nonpublic 
        school pupils who make requests pursuant to this section and who 
        are enrolled as of September 15 of the current school year. 
           Sec. 9.  Minnesota Statutes 2000, section 123B.44, 
        subdivision 6, is amended to read: 
           Subd. 6.  [COMPUTATION OF MAXIMUM ALLOTMENTS.] For purposes 
        of computing maximum allotments for each school year pursuant to 
        this section, the average public school expenditure per pupil 
        for health services and the average public school expenditure 
        per secondary pupil for guidance and counseling services shall 
        be computed and established by the department by March February 
        1 of the preceding school year from the most recent public 
        school year data then available. 
           Sec. 10.  Minnesota Statutes 2000, section 123B.75, 
        subdivision 5, is amended to read: 
           Subd. 5.  [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. 
           (b) In June of each year 2001, the school district must 
        recognize as revenue, in the fund for which the levy was made, 
        the lesser of:  
           (1) the sum of May, June, and July school district tax 
        settlement revenue received in that calendar year plus general 
        education aid according to section 126C.13, subdivision 4, 
        received in July and August of that calendar year; or 
           (2) the sum of: 
           (i) 31 percent of the referendum levy certified in the 
        prior calendar year according to section 126C.17, subdivision 9; 
        plus 
           (ii) the entire amount of the levy certified in the prior 
        calendar year according to sections 124D.86, subdivision 4, for 
        school districts receiving revenue under 124D.86, subdivision 3, 
        clauses (1), (2), and (3); 126C.41, subdivisions 1, 2, and 3, 
        paragraphs (4), (5), and (6); 126C.43, subdivision 2; and 
        126C.48, subdivision 6.  
           (c) For fiscal year 2002 and later years, in June of each 
        year, the school district must recognize as revenue, in the fund 
        for which the levy was made, the lesser of: 
           (1) the sum of May, June, and July school district tax 
        settlement revenue received in that calendar year, plus general 
        education aid according to section 126C.13, subdivision 4, 
        received in July and August of that calendar year; or 
           (2) the sum of: 
           (i) 31 percent of the referendum levy certified according 
        to section 126C.17, in calendar year 2000; plus 
           (ii) the entire amount of the levy certified in the prior 
        calendar year according to section 124D.86, subdivision 4, for 
        school districts receiving revenue under sections 124D.86, 
        subdivision 3, clauses (1), (2), and (3); 126C.41, subdivisions 
        1, 2, and 3, paragraphs (4), (5), and (6); 126C.43, subdivision 
        2; and 126C.48, subdivision 6. 
           [EFFECTIVE DATE.] This section is effective June 30, 2001. 
           Sec. 11.  Minnesota Statutes 2000, section 123B.75, is 
        amended by adding a subdivision to read: 
           Subd. 6b.  [GENERAL EDUCATION AID.] If the amount to be 
        recognized as revenue under subdivision 5 exceeds the May, June, 
        and July school district tax settlement revenue received in that 
        calendar year, the district must recognize an amount of general 
        education aid equal to the difference between the total amount 
        to be recognized as revenue under subdivision 5, and the May, 
        June, and July school district tax settlement revenue received 
        in that calendar year as revenue in the previous fiscal year. 
           [EFFECTIVE DATE.] This section is effective June 30, 2001. 
           Sec. 12.  Minnesota Statutes 2000, section 123B.88, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROVIDING TRANSPORTATION.] The board may 
        provide for the transportation of pupils to and from school and 
        for any other purpose.  The board may also provide for the 
        transportation of pupils to schools in other districts for 
        grades and departments not maintained in the district, including 
        high school, at the expense of the district, when funds are 
        available therefor and if agreeable to the district to which it 
        is proposed to transport the pupils, for the whole or a part of 
        the school year, as it may deem advisable, and subject to its 
        rules.  In any district, the board must arrange for the 
        attendance of all pupils living two miles or more from the 
        school, except pupils whose transportation privileges have been 
        voluntarily surrendered under subdivision 2, or whose privileges 
        have been revoked under section 123B.91, subdivision 1, clause 
        (6), or 123B.90, subdivision 2.  The district may provide for 
        the transportation of or the boarding and rooming of the pupils 
        who may be more economically and conveniently provided for by 
        that means.  Arrangements for attendance may include a 
        requirement that parents or guardians request transportation 
        before it is provided.  The board must provide transportation to 
        and from the home of a child with a disability not yet enrolled 
        in kindergarten when special instruction and services under 
        sections 125A.03 to 125A.24, 125A.26 to 125A.48, and 125A.65 are 
        provided in a location other than in the child's home.  When 
        transportation is provided, scheduling of routes, establishment 
        of the location of bus stops, manner and method of 
        transportation, control and discipline of school children, the 
        determination of fees, and any other matter relating thereto 
        must be within the sole discretion, control, and management of 
        the board.  The district may provide for the transportation of 
        pupils or expend a reasonable amount for room and board of 
        pupils whose attendance at school can more economically and 
        conveniently be provided for by that means or who attend school 
        in a building rented or leased by a district within the confines 
        of an adjacent district. 
           Sec. 13.  Minnesota Statutes 2000, section 124D.69, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AID.] If a pupil enrolls in an alternative 
        program, eligible under section 124D.68, subdivision 3, 
        paragraph (d), or subdivision 4, operated by a private 
        organization that has contracted with a school district to 
        provide educational services for eligible pupils under section 
        124D.68, subdivision 2, the district contracting with the 
        private organization must reimburse the provider an amount equal 
        to at least 90 95 percent of the district's average general 
        education less basic skills revenue per pupil unit times the 
        number of pupil units for pupils attending the program.  Basic 
        skills revenue shall be paid according to section 126C.10, 
        subdivision 4.  Compensatory revenue must be allocated according 
        to section 126C.15, subdivision 2.  For a pupil attending the 
        program part time, the revenue paid to the program must be 
        reduced proportionately, according to the amount of time the 
        pupil attends the program, and 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 general education 
        revenue.  If payment is made to a district or program for a 
        pupil under this section, the department must not make a payment 
        for the same pupil under section 124D.68, subdivision 9. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal years 2002 and later. 
           Sec. 14.  Minnesota Statutes 2000, section 126C.05, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PUPIL UNIT.] Pupil units for each 
        Minnesota resident pupil in average daily membership enrolled in 
        the district of residence, in another district under sections 
        123A.05 to 123A.08, 124D.03, 124D.06, 124D.07, 124D.08, or 
        124D.68; in a charter school under section 124D.10; or for whom 
        the resident district pays tuition under section 123A.18, 
        123A.22, 123A.30, 123A.32, 123A.44, 123A.488, 123B.88, 
        subdivision 4, 124D.04, 124D.05, 125A.03 to 125A.24, 125A.51, or 
        125A.65, shall be counted according to this subdivision.  
           (a) A prekindergarten pupil with a disability who is 
        enrolled in a program approved by the commissioner and has an 
        individual education plan is counted as the ratio of the number 
        of hours of assessment and education service to 825 times 1.25 
        with a minimum average daily membership of 0.28, but not more 
        than 1.25 pupil units. 
           (b) A prekindergarten pupil who is assessed but determined 
        not to be handicapped is counted as the ratio of the number of 
        hours of assessment service to 825 times 1.25.  
           (c) A kindergarten pupil with a disability who is enrolled 
        in a program approved by the commissioner is counted as the 
        ratio of the number of hours of assessment and education 
        services required in the fiscal year by the pupil's individual 
        education program plan to 875, but not more than one. 
           (d) A kindergarten pupil who is not included in paragraph 
        (c) is counted as .557 of a pupil unit for fiscal year 2000 and 
        thereafter. 
           (e) A pupil who is in any of grades 1 to 3 is counted as 
        1.115 pupil units for fiscal year 2000 and thereafter. 
           (f) A pupil who is any of grades 4 to 6 is counted as 1.06 
        pupil units for fiscal year 1995 and thereafter. 
           (g) A pupil who is in any of grades 7 to 12 is counted as 
        1.3 pupil units.  
           (h) A pupil who is in the post-secondary enrollment options 
        program is counted as 1.3 pupil units.  
           Sec. 15.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GENERAL EDUCATION REVENUE.] (a) For fiscal 
        year 2000 and thereafter 2002, 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, equity 
        revenue, referendum offset adjustment, transition revenue, and 
        supplemental revenue. 
           (b) For fiscal year 2003 and later, 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, and equity revenue. 
           Sec. 16.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 2, is amended to read: 
           Subd. 2.  [BASIC REVENUE.] The basic revenue for each 
        district equals the formula allowance times the adjusted 
        marginal cost pupil units for the school year.  The formula 
        allowance for fiscal year 1998 is $3,581.  The formula allowance 
        for fiscal year 1999 is $3,530.  The formula allowance for 
        fiscal year 2000 is $3,740.  The formula allowance for fiscal 
        year 2001 and subsequent fiscal years is $3,964.  The formula 
        allowance for fiscal year 2002 is $4,068.  The formula allowance 
        for fiscal year 2003 and subsequent years is $4,601. 
           Sec. 17.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 4, is amended to read: 
           Subd. 4.  [BASIC SKILLS REVENUE.] (a) For fiscal year 1999 
        and thereafter 2002, 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 124D.65, subdivision 5; plus 
           (3) $190 times the limited English proficiency pupil units 
        according to section 126C.05, subdivision 17; plus 
           (4) $22.50 times the number of adjusted marginal cost pupil 
        units in kindergarten to grade 8. 
           (b) For fiscal year 2003, a school district's basic skills 
        revenue equals the sum of: 
           (1) compensatory revenue under subdivision 3; plus 
           (2) limited English proficiency revenue under section 
        124D.65, subdivision 5; plus 
           (3) $190 times the limited English proficiency pupil units 
        under section 126C.05, subdivision 17. 
           Sec. 18.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 9, is amended to read: 
           Subd. 9.  [SUPPLEMENTAL REVENUE.] (a) A district's 
        supplemental revenue allowance for fiscal year 1994 and later 
        fiscal years 2002 equals the district's supplemental 
        revenue allowance for fiscal year 1993 divided by the district's 
        1992-1993 resident pupil units 2001. 
           (b) A district's supplemental revenue allowance is reduced 
        for fiscal year 1995 and later according to subdivision 12. 
           (c) A district's supplemental revenue equals the 
        supplemental revenue allowance, if any, times its adjusted 
        marginal cost pupil units for that year.  
           (d) A district may cancel its supplemental revenue by 
        notifying the commissioner of education prior to June 30, 1994.  
        A district that is reorganizing under section 123A.35, 123A.46, 
        or 123A.48 may cancel its supplemental revenue by notifying the 
        commissioner of children, families, and learning before July 1 
        of the year of the reorganization.  If a district cancels its 
        supplemental revenue according to this paragraph, its 
        supplemental revenue allowance for fiscal year 1993 for purposes 
        of subdivision 12 and section 124A.03, subdivision 3b, equals 
        zero. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2002. 
           Sec. 19.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 13, is amended to read: 
           Subd. 13.  [TOTAL OPERATING CAPITAL REVENUE.] (a) For 
        fiscal year 2000 and thereafter, total operating capital revenue 
        for a district equals the amount determined under paragraph (b) 
        or (c), plus $73 times the adjusted marginal cost pupil units 
        for the school year.  The revenue must be placed in a reserved 
        account in the general fund and may only be used according to 
        paragraph (d) or subdivision 14. 
           (b) For fiscal years 2000 and later, capital revenue for a 
        district equals $100 times the district's maintenance cost index 
        times its adjusted marginal cost pupil units for the school year.
           (c) For fiscal years 2000 and later, the revenue for a 
        district that operates a program under section 124D.128, is 
        increased by an amount equal to $30 times the number of marginal 
        cost pupil units served at the site where the program is 
        implemented. 
           (d) For fiscal years 2001 and 2002, the district must 
        reserve an amount equal to $5 per adjusted marginal cost pupil 
        unit for telecommunication access costs.  Reserve revenue under 
        this paragraph must first be used to pay for ongoing or 
        recurring telecommunication access costs, including access to 
        data lines, and video lines connections, or including 
        Internet access.  Any revenue remaining after covering all 
        ongoing or recurring access costs may be used for computer 
        hardware or equipment. 
           Sec. 20.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 24, is amended to read: 
           Subd. 24.  [EQUITY REVENUE.] (a) A school district 
        qualifies for equity revenue if: 
           (1) the school district's adjusted marginal cost pupil unit 
        amount of basic revenue, supplemental revenue, transition 
        revenue, and referendum revenue is less than the value of the 
        school district at or immediately above the 90th 95th percentile 
        of school districts in its equity region for those revenue 
        categories; and 
           (2) the school district's administrative offices are not 
        located in a city of the first class on July 1, 1999. 
           (b) Equity revenue for a qualifying district that receives 
        referendum revenue under section 126C.17, subdivision 4, equals 
        the product of (1) the district's adjusted marginal cost pupil 
        units for that year; times (2) the sum of (i) $10, plus (ii) 
        $30 $55, times the school district's equity index computed under 
        subdivision 27. 
           (c) Equity revenue for a qualifying district that does not 
        receive referendum revenue under section 126C.17, subdivision 4, 
        equals the product of the district's adjusted marginal cost 
        pupil units for that year times $10. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2002 and later. 
           Sec. 21.  Minnesota Statutes 2000, section 126C.10, 
        subdivision 25, is amended to read: 
           Subd. 25.  [REGIONAL EQUITY GAP.] The regional equity gap 
        equals the difference between the value of the school district 
        at or immediately above the fifth percentile of adjusted general 
        revenue per adjusted marginal cost pupil unit and the value of 
        the school district at or immediately above the 90th 95th 
        percentile of adjusted general revenue per adjusted marginal 
        cost pupil unit. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2002 and later. 
           Sec. 22.  Minnesota Statutes 2000, section 126C.12, 
        subdivision 2, is amended to read: 
           Subd. 2.  [INSTRUCTOR DEFINED DEFINITIONS.] Primary 
        instructor (a) "Classroom teacher" means a public employee 
        licensed by the board of teaching who is authorized to teach all 
        subjects to children in any grade in kindergarten through grade 
        6 and whose duties are full-time regular classroom instruction, 
        excluding a teacher for whom federal aids are received or for 
        whom categorical aids are received pursuant to under section 
        125A.76 or who is an itinerant teacher or provides instruction 
        outside of the regular classroom.  Except as provided in section 
        122A.68, subdivision 6, instructor classroom teacher does not 
        include supervisory and support personnel, except school social 
        workers as defined in section 122A.15.  An instructor A 
        classroom teacher whose duties are less than full-time 
        instruction must be included as an equivalent only for the 
        number of hours of instruction in grades kindergarten through 6 
        grade 3.  
           (b) "Class size" means the districtwide ratio at each grade 
        level of the number of full-time students in kindergarten 
        through grade 3 served at least 40 percent of the time in 
        regular classrooms to the number of full-time classroom teachers 
        in kindergarten through grade 3, determined as of October 1 of 
        each school year. 
           Sec. 23.  Minnesota Statutes 2000, section 126C.12, 
        subdivision 3, is amended to read: 
           Subd. 3.  [INSTRUCTION CONTACT TIME.] Instruction may be 
        provided by a primary instructor, classroom teacher or by a team 
        of instructors classroom teachers, or by a teacher resident 
        supervised by a primary instructor classroom teacher.  The 
        district must maximize instructor classroom teacher to learner 
        average instructional contact time in the core subjects of 
        reading and mathematics. 
           Sec. 24.  Minnesota Statutes 2000, section 126C.12, 
        subdivision 4, is amended to read: 
           Subd. 4.  [REVENUE USE.] (a) Revenue must be used according 
        to either paragraph (b) or (c). 
           (b) Revenue must be used to reduce and maintain the 
        district's instructor to learner ratios average class size in 
        kindergarten through grade 6 3 to a level of 1 17 to 17 1 on 
        average in each of the respective grades.  The district must 
        prioritize the use of the revenue to attain this level initially 
        in kindergarten and grade 1 and then through the subsequent 
        grades as revenue is available.  
           (c) The revenue may be used to prepare and use an 
        individualized learning plan for each learner.  (b) A district 
        must not increase the district wide instructor-to-learner ratios 
        districtwide class sizes in other grades as a result of reducing 
        instructor-to-learner ratios class sizes in kindergarten through 
        grade 6 3.  Revenue may not be used to provide instructor 
        preparation time.  A district may use a portion of the revenue 
        reserved under this section to employ up to the same number of 
        full-time equivalent education assistants or aides as the 
        district employed during the 1992-1993 school year under 
        Minnesota Statutes 1992, section 124.331, subdivision 2 through 
        fiscal year 2002.  Beginning in fiscal year 2003, class size 
        reduction revenue may only be reserved to employ classroom 
        teachers contributing to lower class sizes in kindergarten 
        through grade 3. 
           Sec. 25.  Minnesota Statutes 2000, section 126C.12, 
        subdivision 5, is amended to read: 
           Subd. 5.  [ADDITIONAL REVENUE USE.] If the board of a 
        district determines that the district has achieved and is 
        maintaining the instructor-to-learner ratios class sizes 
        specified in subdivision 4 and is using individualized learning 
        plans, the board may use the revenue to reduce class size in 
        grades 4, 5, and 6, provide all-day, everyday kindergarten, 
        prepare and use individualized learning plans, improve program 
        offerings, purchase instructional material and, services, or 
        technology, or provide staff development needed for reduced 
        instructor-to-learner ratios.  If additional revenue remains, 
        the district must use the revenue to improve program offerings, 
        including programs provided through interactive television, 
        throughout the district or other general education 
        purposes class sizes. 
           Sec. 26.  Minnesota Statutes 2000, section 126C.12, is 
        amended by adding a subdivision to read: 
           Subd. 6.  [ANNUAL REPORT.] By December 1 of each year, 
        districts receiving revenue under subdivision 1 shall make 
        available to the public a report on the amount of revenue the 
        district has received and the use of the revenue.  This report 
        shall be in the form and manner determined by the commissioner 
        and shall include the district average class sizes in 
        kindergarten through grade 6 as of October 1 of the current 
        school year and the class sizes for each site serving 
        kindergarten through grade 6 students in the district.  A copy 
        of the report shall be filed with the commissioner by December 
        15. 
           Sec. 27.  [126C.126] [REALLOCATING GENERAL EDUCATION 
        REVENUE FOR ALL-DAY KINDERGARTEN.] 
           In order to provide additional revenue for an optional 
        all-day kindergarten program, a district may reallocate general 
        education revenue attributable to 12th grade students who have 
        graduated early under section 120B.07.  
           [EFFECTIVE DATE.] This section is effective for fiscal year 
        2002 and later. 
           Sec. 28.  Minnesota Statutes 2000, section 126C.15, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [USE OF THE REVENUE.] The basic skills 
        revenue under section 126C.10, subdivision 4, and the portion of 
        the transition revenue adjustment under section 126C.10, 
        subdivision 20, attributable to the compensatory transition 
        allowance under section 126C.10, subdivision 19, paragraph (b), 
        must be reserved and used to meet the educational needs of 
        pupils who enroll under-prepared to learn and whose progress 
        toward meeting state or local content or performance standards 
        is below the level that is appropriate for learners of their 
        age.  Any of the following may be provided to meet these 
        learners' needs: 
           (1) direct instructional services under the assurance of 
        mastery program according to section 124D.66; 
           (2) remedial instruction in reading, language arts, 
        mathematics, other content areas, or study skills to improve the 
        achievement level of these learners; 
           (3) additional teachers and teacher aides to provide more 
        individualized instruction to these learners through individual 
        tutoring, lower instructor-to-learner ratios, or team teaching; 
           (4) a longer school day or week during the regular school 
        year or through a summer program that may be offered directly by 
        the site or under a performance-based contract with a 
        community-based organization; 
           (5) comprehensive and ongoing staff development consistent 
        with district and site plans according to section 122A.60, for 
        teachers, teacher aides, principals, and other personnel to 
        improve their ability to identify the needs of these learners 
        and provide appropriate remediation, intervention, 
        accommodations, or modifications; 
           (6) instructional materials 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 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.  
           Sec. 29.  Minnesota Statutes 2000, section 126C.15, 
        subdivision 2, is amended to read: 
           Subd. 2.  [BUILDING ALLOCATION.] (a) A district must 
        allocate its compensatory revenue to each school building in the 
        district where the children who have generated the revenue are 
        served. 
           (b) Notwithstanding paragraph (a), for fiscal years 1999, 
        2000, and 2001, upon approval by the commissioner, a district 
        may allocate up to five percent of the amount of compensatory 
        revenue that the district would have received under Minnesota 
        Statutes 1996, section 124A.22, subdivision 3, for fiscal year 
        1998, computed using a basic formula allowance of $3,581 during 
        the previous fiscal year to school sites according to a plan 
        adopted by the school board. 
           (c) For the purposes of this section and section 126C.05, 
        subdivision 3, "building" means education site as defined in 
        section 123B.04, subdivision 1. 
           (d) 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.  
           Sec. 30.  Minnesota Statutes 2000, section 126C.15, 
        subdivision 5, is amended to read: 
           Subd. 5.  [ANNUAL EXPENDITURE REPORT.] Each year a district 
        that receives basic skills revenue must submit a report 
        identifying the expenditures it incurred to meet the needs of 
        eligible learners under subdivision 1.  The report must conform 
        to uniform financial and reporting standards established for 
        this purpose.  Using valid and reliable data and measurement 
        criteria, the report also must determine whether increased 
        expenditures raised student achievement levels. 
           Sec. 31.  Minnesota Statutes 2000, section 126C.17, 
        subdivision 6, is amended to read: 
           Subd. 6.  [REFERENDUM EQUALIZATION LEVY.] (a) A district's 
        referendum equalization levy for a referendum levied against the 
        referendum market value of all taxable property as defined in 
        section 126C.01, subdivision 3, equals the district's referendum 
        equalization revenue times the lesser of one or the ratio of the 
        district's referendum market value per resident marginal cost 
        pupil unit to $476,000. 
           (b) 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 resident marginal cost pupil unit to $8,404.
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2002. 
           Sec. 32.  Minnesota Statutes 2000, section 126C.17, 
        subdivision 9, is amended to read: 
           Subd. 9.  [REFERENDUM REVENUE.] (a) The revenue authorized 
        by section 126C.10, subdivision 1, may be increased in the 
        amount approved by the voters of the district at a referendum 
        called for the purpose.  The referendum may be called by the 
        board or shall be called by the board upon written petition of 
        qualified voters of the district.  The referendum must be 
        conducted one or two calendar years before the increased levy 
        authority, if approved, first becomes payable.  Only one 
        election to approve an increase may be held in a calendar year.  
        Unless the referendum is conducted by mail under paragraph (g), 
        the referendum must be held on the first Tuesday after the first 
        Monday in November.  The ballot must state the maximum amount of 
        the increased revenue per resident marginal cost pupil unit, the 
        estimated referendum tax rate as a percentage of referendum 
        market value in the first year it is to be levied, and that the 
        revenue must be used to finance school operations.  The ballot 
        may state a schedule, determined by the board, of increased 
        revenue per resident marginal cost pupil unit that differs from 
        year to year over the number of years for which the increased 
        revenue is authorized.  If the ballot contains a schedule 
        showing different amounts, it must also indicate the estimated 
        referendum tax rate as a percent of referendum market value for 
        the amount specified for the first year and for the maximum 
        amount specified in the schedule.  The ballot may state that 
        existing referendum levy authority is expiring.  In this case, 
        the ballot may also compare the proposed levy authority to the 
        existing expiring levy authority, and express the proposed 
        increase as the amount, if any, over the expiring referendum 
        levy authority.  The ballot must designate the specific number 
        of years, not to exceed ten, for which the referendum 
        authorization applies.  The notice required under section 275.60 
        may be modified to read, in cases of renewing existing levies: 
           "BY VOTING "YES" ON THIS BALLOT QUESTION, YOU MAY BE VOTING 
           FOR A PROPERTY TAX INCREASE." 
           The ballot may contain a textual portion with the 
        information required in this subdivision and a question stating 
        substantially the following:  
           "Shall the increase in the revenue proposed by (petition 
        to) the board of ........., School District No. .., be approved?"
           If approved, an amount equal to the approved revenue per 
        resident marginal cost pupil unit times the resident marginal 
        cost pupil units for the school year beginning in the year after 
        the levy is certified shall be authorized for certification for 
        the number of years approved, if applicable, or until revoked or 
        reduced by the voters of the district at a subsequent referendum.
           (b) The board must prepare and deliver by first class mail 
        at least 15 days but no more than 30 days before the day of the 
        referendum to each taxpayer a notice of the referendum and the 
        proposed revenue increase.  The board need not mail more than 
        one notice to any taxpayer.  For the purpose of giving mailed 
        notice under this subdivision, owners must be those shown to be 
        owners on the records of the county auditor or, in any county 
        where tax statements are mailed by the county treasurer, on the 
        records of the county treasurer.  Every property owner whose 
        name does not appear on the records of the county auditor or the 
        county treasurer is deemed to have waived this mailed notice 
        unless the owner has requested in writing that the county 
        auditor or county treasurer, as the case may be, include the 
        name on the records for this purpose.  The notice must project 
        the anticipated amount of tax increase in annual dollars and 
        annual percentage for typical residential homesteads, 
        agricultural homesteads, apartments, and commercial-industrial 
        property within the school district. 
           The notice for a referendum may state that an existing 
        referendum levy is expiring and project the anticipated amount 
        of increase over the existing referendum levy in the first year, 
        if any, in annual dollars and annual percentage for typical 
        residential homesteads, agricultural homesteads, apartments, and 
        commercial-industrial property within the district. 
           The notice must include the following statement:  "Passage 
        of this referendum will result in an increase in your property 
        taxes."  However, in cases of renewing existing levies, the 
        notice may include the following statement:  "Passage of this 
        referendum may result in an increase in your property taxes." 
           (c) A referendum on the question of revoking or reducing 
        the increased revenue amount authorized pursuant to paragraph 
        (a) may be called by the board and shall be called by the board 
        upon the written petition of qualified voters of the district.  
        A referendum to revoke or reduce the levy amount must be based 
        upon the dollar amount, local tax rate, or amount per resident 
        marginal cost pupil unit, that was stated to be the basis for 
        the initial authorization.  Revenue approved by the voters of 
        the district pursuant to paragraph (a) must be received at least 
        once before it is subject to a referendum on its revocation or 
        reduction for subsequent years.  Only one revocation or 
        reduction referendum may be held to revoke or reduce referendum 
        revenue for any specific year and for years thereafter. 
           (d) A petition authorized by paragraph (a) or (c) is 
        effective if signed by a number of qualified voters in excess of 
        15 percent of the registered voters of the district on the day 
        the petition is filed with the board.  A referendum invoked by 
        petition must be held on the date specified in paragraph (a). 
           (e) The approval of 50 percent plus one of those voting on 
        the question is required to pass a referendum authorized by this 
        subdivision. 
           (f) At least 15 days before the day of the referendum, the 
        district must submit a copy of the notice required under 
        paragraph (b) to the commissioner and to the county auditor of 
        each county in which the district is located.  Within 15 days 
        after the results of the referendum have been certified by the 
        board, or in the case of a recount, the certification of the 
        results of the recount by the canvassing board, the district 
        must notify the commissioner of the results of the referendum. 
           (g) Except for a referendum held under subdivision 11, any 
        referendum under this section held on a day other than the first 
        Tuesday after the first Monday in November must be conducted by 
        mail in accordance with section 204B.46.  Notwithstanding 
        paragraph (b) to the contrary, in the case of a referendum 
        conducted by mail under this paragraph, the notice required by 
        paragraph (b) must be prepared and delivered by first class mail 
        at least 20 days before the referendum. 
           Sec. 33.  Minnesota Statutes 2000, section 126C.17, 
        subdivision 10, is amended to read: 
           Subd. 10.  [SCHOOL REFERENDUM LEVY; MARKET VALUE.] 
        Notwithstanding the provisions of subdivision 9, A school 
        referendum levy approved after November 1, 1992, for taxes 
        payable in 1993 and thereafter, must be levied against the 
        referendum market value of all taxable property as defined in 
        section 126C.01, subdivision 3.  Any referendum levy amount 
        subject to the requirements of this subdivision must be 
        certified separately to the county auditor under section 275.07. 
           All other provisions of subdivision 9 that do not conflict 
        with this subdivision apply to referendum levies under this 
        subdivision.  
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2002. 
           Sec. 34.  Minnesota Statutes 2000, section 126C.17, 
        subdivision 11, is amended to read: 
           Subd. 11.  [REFERENDUM DATE.] (a) Except for a referendum 
        held under paragraph (b), any referendum under this section held 
        on a day other than the first Tuesday after the first Monday in 
        November must be conducted by mail in accordance with section 
        204B.46.  Notwithstanding subdivision 9, paragraph (b), to the 
        contrary, in the case of a referendum conducted by mail under 
        this paragraph, the notice required by subdivision 9, paragraph 
        (b), must be prepared and delivered by first-class mail at least 
        20 days before the referendum. 
           (b) In addition to the referenda allowed in subdivision 9, 
        clause (a), the commissioner may authorize a referendum for a 
        different day.  
           (a) The commissioner may grant authority to a district to 
        hold a referendum on a different day if the district is in 
        statutory operating debt and has an approved plan or has 
        received an extension from the department to file a plan to 
        eliminate the statutory operating debt.  
           (b) The commissioner may grant authority for a district to 
        hold a referendum on a different day if:  (1) the district will 
        conduct a bond election under chapter 475 on that same day; and 
        (2) the proceeds of the referendum will provide only additional 
        operating revenue complementing the purpose for which bonding 
        authority is sought.  The commissioner may only grant authority 
        under this paragraph if the district demonstrates to the 
        commissioner's satisfaction that the district's ability to 
        operate the new facility or achieve efficiencies with the 
        purchases connected to the proceeds of the bond sale will be 
        significantly affected if the operating referendum is not 
        conducted until the November general election.  Authority under 
        this paragraph expires November 30, 1998. 
           (c) The commissioner must approve, deny, or modify each 
        district's request for a referendum levy on a different day 
        within 60 days of receiving the request from a district. 
           Sec. 35.  Minnesota Statutes 2000, section 126C.23, 
        subdivision 5, is amended to read: 
           Subd. 5.  [DATA REPORTING.] Each district must report to 
        the commissioner the estimated amount of general education and 
        referendum initially allocated to each building under 
        subdivision 2 and the amount of any reallocations under 
        subdivision 3 by January 30 of the current fiscal year, and the 
        actual amount of general education and referendum revenue 
        initially allocated to each building under subdivision 2 and the 
        amount of any reallocations under subdivision 3 by January 30 of 
        the next fiscal year. 
           Sec. 36.  Minnesota Statutes 2000, section 126C.41, 
        subdivision 2, is amended to read: 
           Subd. 2.  [RETIRED EMPLOYEE HEALTH BENEFITS.] A 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 $600,000.  
           Sec. 37.  Minnesota Statutes 2000, section 126C.41, 
        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) (a) 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 must 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) (b) 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.  
           (5) (c) 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.  If an applicable school district levies under this 
        paragraph, they may not levy under paragraph (4) (b). 
           (6) (d) In addition to the levy authorized under paragraph 
        (5) (c), 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.  
           Sec. 38.  Minnesota Statutes 2000, section 126C.43, 
        subdivision 3, is amended to read: 
           Subd. 3.  [TAX LEVY FOR UNPAID JUDGMENT.] A district may 
        levy the amounts necessary to pay the district's obligations 
        judgments against the district under section 126C.47 123B.25 
        that became final after the date the district certified its 
        proposed levy in the previous year.  With the approval of the 
        commissioner, a district may spread this levy over a period not 
        to exceed three years. 
           Sec. 39.  Minnesota Statutes 2000, section 127A.41, 
        subdivision 5, is amended to read: 
           Subd. 5.  [DISTRICT APPEAL OF AID REDUCTION; INSPECTION OF 
        DISTRICT SCHOOLS AND ACCOUNTS AND RECORDS.] Public schools shall 
        at all times be open to the inspection of the commissioner.  The 
        accounts and records of any district must be open to inspection 
        by the state auditor, or the commissioner for the purpose of 
        audits conducted under this section.  Each district shall keep 
        for a minimum of three years at least the following:  (1) 
        identification of the annual session days held, together with a 
        record of the length of each session day, (2) a record of each 
        pupil's daily attendance, with entrance and withdrawal dates, 
        and (3) identification of the pupils transported who are 
        reported for transportation aid to-and-from school 
        transportation category for each pupil as defined in section 
        123B.92, subdivision 1. 
           Sec. 40.  Minnesota Statutes 2000, section 127A.50, 
        subdivision 2, is amended to read: 
           Subd. 2.  [APPROPRIATION AND ESTIMATED NET SAVINGS.] The 
        amounts necessary to pay any positive net adjustments under this 
        section to any school district are appropriated annually from 
        the general fund to the commissioner of children, families, and 
        learning.  The estimated net general fund savings under this 
        section is $29,819,000 in fiscal year 1998, and $26,997,000 in 
        each fiscal year thereafter. 
           Sec. 41.  Minnesota Statutes 2000, section 127A.51, is 
        amended to read: 
           127A.51 [STATEWIDE AVERAGE REVENUE.] 
           By October 1 of each year the commissioner must estimate 
        the statewide average adjusted general revenue per adjusted 
        marginal cost pupil unit and the disparity in adjusted general 
        revenue among pupils and districts by computing the ratio of the 
        ninety-fifth percentile to the fifth percentile of adjusted 
        general revenue.  The commissioner must provide that information 
        to all districts. 
           If the disparity in adjusted general revenue as measured by 
        the ratio of the ninety-fifth percentile to the fifth percentile 
        increases in any year, the commissioner shall recommend to the 
        legislature options for change in the general education formula 
        that will limit the disparity in adjusted general revenue to no 
        more than the disparity for the previous school year.  The 
        commissioner must submit the recommended options to the 
        education committees of the legislature by January 15. 
           For purposes of this section and section 126C.10, adjusted 
        general revenue means: 
           (1) for fiscal year 2002, the sum of basic revenue under 
        section 126C.10, subdivision 2; supplemental revenue under 
        section 126C.10, subdivisions 9 and 12; transition revenue under 
        section 126C.10, subdivision 20; and referendum revenue under 
        section 126C.17; and equity revenue under section 126C.10, 
        subdivisions 24a and 24b; and 
           (2) for fiscal year 2003 and later, the sum of basic 
        revenue under section 126C.10, subdivision 2; referendum revenue 
        under section 126C.17; and equity revenue under section 126C.10, 
        subdivisions 24a and 24b. 
           Sec. 42.  Laws 1992, chapter 499, article 7, section 31, as 
        amended by Laws 1998, chapter 398, article 1, section 39, Laws 
        1999, chapter 241, article 1, section 54, and Laws 2000, chapter 
        489, article 2, section 28, is amended to read: 
           Sec. 31.  [REPEALER.] 
           Minnesota Statutes 1990, sections 124A.02, subdivision 24; 
        124A.23, subdivisions 2 and 3; 124A.26, subdivisions 2 and 3; 
        124A.27; 124A.28; and 124A.29, subdivision 2; and Minnesota 
        Statutes 1991 Supplement, sections 124A.02, subdivisions 16 and 
        23; 124A.03, subdivisions 1b, 1c, 1d, 1e, 1f, 1g, 1h, and 1i; 
        124A.04; 124A.22, subdivisions 2, 3, 4, 4a, 4b, 8, and 9; 
        124A.23, subdivisions 1, 4, and 5; 124A.24; 124A.26, subdivision 
        1; and 124A.29, subdivision 1, are repealed effective June 30, 
        2004; Laws 1991, chapter 265, article 7, section 35, is repealed.
           Sec. 43.  Laws 2000, chapter 489, article 2, section 34, is 
        amended to read: 
           Sec. 34.  [TRAINING AND EXPERIENCE REPLACEMENT REVENUE.] 
           (a) For fiscal year 2001 only, a school district's training 
        and experience replacement revenue equals the sum of the 
        following: 
           (1) the ratio of the amount of training and experience 
        revenue the district would have received for fiscal year 1999 
        calculated using the training and experience index in Minnesota 
        Statutes 1996, section 124A.04, to its resident pupil units for 
        that year, times the district's adjusted marginal cost pupil 
        units for fiscal year 2001, times .06; plus 
           (2) the difference between .47 times the training and 
        experience revenue the district would have received for fiscal 
        year 1999, calculated using the training and experience index in 
        Minnesota Statutes 1996, section 124A.04, and the amount 
        calculated in Minnesota Statutes, section 126C.10, subdivision 
        5, for fiscal year 2001, but not less than zero. 
           (b) This revenue is paid entirely in fiscal year 2001 based 
        on estimated data. 
           (c) By January 31, 2002, the department of children, 
        families, and learning shall recalculate the revenue for each 
        district using actual data, and shall adjust the general 
        education aid paid to school districts for fiscal year 2002 by 
        the amount of the difference between the estimated revenue and 
        the actual revenue. 
           Sec. 44.  Laws 2000, chapter 489, article 2, section 36, is 
        amended to read: 
           Sec. 36.  [FISCAL YEARS 2003 2004 TO 2007 2008 AIRPORT 
        RUNWAY IMPACT PUPIL UNIT AID; RICHFIELD.] 
           Subdivision 1.  [AIRPORT IMPACT ZONE PUPIL UNITS, 
        DEFINITION.] For the purposes of this section, "airport impact 
        zone pupil units" means the number of pupil units, according to 
        Minnesota Statutes 1999 Supplement, section 126C.05, subdivision 
        1, in school year 1998-1999 that were attributable to the 
        airport impact zone, as defined in Laws 1999, chapter 243, 
        article 16, section 35, subdivision 1. 
           Subd. 2.  [FISCAL YEAR 2003 2004.] For fiscal year 2003 
        2004 only, independent school district No. 280, Richfield, is 
        eligible for declining pupil unit aid equal to the product of 70 
        percent of the airport impact zone pupil units times the general 
        education formula allowance for fiscal year 2003 2004. 
           Subd. 3.  [FISCAL YEAR 2004 2005.] For fiscal year 2004 
        2005 only, independent school district No. 280, Richfield, is 
        eligible for declining pupil unit aid equal to the product of 70 
        percent of the airport impact zone pupil units times the general 
        education formula allowance for fiscal year 2004 2005. 
           Subd. 4.  [FISCAL YEAR 2005 2006.] For fiscal year 2005 
        2006 only, independent school district No. 280, Richfield, is 
        eligible for declining pupil unit aid equal to the product of 
        52.5 percent of the airport impact zone pupil units times the 
        general education formula allowance for fiscal year 2005 2006. 
           Subd. 5.  [FISCAL YEAR 2006 2007.] For fiscal year 2006 
        2007 only, independent school district No. 280, Richfield, is 
        eligible for declining pupil unit aid equal to the product of 35 
        percent of the airport impact zone pupil units times the general 
        education formula allowance for fiscal year 2006 2007. 
           Subd. 6.  [FISCAL YEAR 2007 2008.] For fiscal year 2007 
        2008 only, independent school district No. 280, Richfield, is 
        eligible for declining pupil unit aid equal to the product of 
        17.5 percent of the airport impact zone pupil units times the 
        general education formula allowance for fiscal year 2007 2008.  
           Sec. 45.  Laws 2000, chapter 489, article 2, section 37, 
        subdivision 3, is amended to read: 
           Subd. 3.  [FISCAL YEAR 2001 CALCULATION.] (a) For fiscal 
        year 2001, a school district's sparsity correction revenue 
        equals .5 times the difference between sparsity revenue in 
        fiscal year 2001 calculated according to Laws 1999, chapter 241, 
        article 1, sections 18 and 19, and the sparsity revenue the 
        district would have received for fiscal year 2001 had these 
        sections of law not been approved. 
           (b) This revenue is paid entirely in fiscal year 2001 based 
        on estimated data.  
           (c) By January 31, 2002, the department of children, 
        families, and learning shall recalculate the revenue for each 
        district using actual data, and shall adjust the general 
        education aid paid to school districts for fiscal year 2002 by 
        the amount of the difference between the estimated revenue and 
        the actual revenue. 
           Sec. 46.  Laws 2000, chapter 489, article 2, section 39, 
        subdivision 2, is amended to read: 
           Subd. 2.  [SPARSITY CORRECTION REVENUE.] For sparsity 
        correction revenue: 
             $1,030,000     .....     2000
             $  515,000     .....     2001
           The 2000 appropriation is available until June 30, 2001.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 47.  Laws 2000, chapter 489, article 3, section 25, 
        subdivision 5, is amended to read: 
           Subd. 5.  [SPECIAL EDUCATION CROSS-SUBSIDY REVENUE.] For 
        special education cross-subsidy revenue: 
             $ 7,898,000     .....     2000 
             $18,396,000     .....     2001 
           The 2000 appropriation is available until June 30, 2001. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 48.  [LEGISLATIVE TASK FORCE ON REDUCING THE 
        COMPLEXITY AND INEQUITIES OF KINDERGARTEN THROUGH GRADE 12 
        EDUCATION FUNDING STATUTES AND RULES.] 
           (a) The legislative task force on reducing the complexity 
        and inequities of kindergarten through grade 12 education 
        funding consists of eight members.  The speaker of the house of 
        representatives, considering geographical balance, shall appoint 
        four members from the house, two of whom must be minority caucus 
        members.  The subcommittee on committees of the senate committee 
        on rules and administration, considering geographical balance, 
        shall appoint four members from the senate, two of whom must be 
        minority caucus members. 
           (b) The task force shall study and recommend to the 
        legislature by January 15, 2002, and by January 15, 2003, any 
        changes in statutes and rules needed to improve equity and 
        quality in and to simplify, clarify, and reduce the complexity 
        of the kindergarten through grade 12 education funding system.  
        The task force shall consider at least the following in 
        recommending changes in statutes and rules: 
           (1) the extent to which funding system and related 
        statutory and rule provisions are easily read and understood by 
        the public; 
           (2) the extent to which the funding system can be 
        simplified; 
           (3) how to resolve funding disparities between students; 
           (4) how voters' funding decisions affect district equity; 
           (5) how to create more equitable per student education 
        funding, including funding for alternative learning centers, 
        contracted alternatives, and charter schools; 
           (6) the extent to which regional variations in cost and 
        differentials in market-based wages affect school district 
        costs; 
           (7) how to define compensatory revenue to most effectively 
        meet the academic needs of students in attendance areas of high 
        concentrations of poverty; 
           (8) how to equitably distribute integration revenue based 
        on the level of services provided under the integration plan; 
        and 
           (9) the extent to which the legislative process of funding 
        kindergarten through grade 12 education can be improved to 
        provide school districts with timely, accurate information 
        concerning legislative decisions. 
           (c) The task force shall seek the input of various 
        kindergarten through grade 12 education stakeholders and the 
        general public in making its recommendations.  The task force 
        may call upon the department of children, families, and learning 
        to assist with its duties.  Upon submission of its 
        recommendations, the task force expires. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 49.  [DECLINING PUPIL UNIT AID; YELLOW MEDICINE EAST.] 
           Subdivision 1.  [FISCAL YEAR 2002.] For fiscal year 2002, 
        independent school district No. 2190, Yellow Medicine East, is 
        eligible for tornado impact declining enrollment aid equal to 
        $156,000. 
           Subd. 2.  [FISCAL YEAR 2003.] For fiscal year 2003, 
        independent school district No. 2190, Yellow Medicine East, is 
        eligible for tornado impact declining enrollment aid equal to 75 
        percent of the fiscal year 2002 appropriation in subdivision 1. 
           Subd. 3.  [FISCAL YEAR 2004.] For fiscal year 2004, 
        independent school district No. 2190, Yellow Medicine East, is 
        eligible for tornado impact declining enrollment aid equal to 50 
        percent of the fiscal year 2002 appropriation in subdivision 1. 
           Subd. 4.  [FISCAL YEAR 2005.] For fiscal year 2005, 
        independent school district No. 2190, Yellow Medicine East, is 
        eligible for tornado impact declining enrollment aid equal to 25 
        percent of the fiscal year 2002 appropriation in subdivision 1. 
           Sec. 50.  [SUPPLEMENTAL REVENUE; ANOKA AND DULUTH.] 
           For fiscal year 2002, the supplemental revenue for 
        independent school districts Nos. 11, Anoka, and 709, Duluth, is 
        increased by $500,000.  
           Sec. 51.  [DIRECTION TO COMMISSIONER; TRANSPORTATION.] 
           (a) The commissioner of children, families, and learning 
        must collect from each school district data needed to examine 
        pupil transportation costs for the following ridership 
        categories:  regular, hazardous, disabled, nonpublic, charter 
        schools, desegregation, noon kindergarten, learning year summer 
        and summer school, between schools, late activity, enrollment 
        options, student activity trips, safety requirements, and bus 
        replacement. 
           (b) The commissioner, by February 15, 2002, must prepare a 
        report on per pupil transportation costs to the legislative 
        committees responsible for kindergarten through grade 12 
        education finance.  The report must: 
           (1) identify funding inequities; 
           (2) make recommendations for providing equitable 
        transportation funding; 
           (3) consider changes in student demographics, attendance 
        patterns, declining enrollment, district topography, labor and 
        fuel costs; and 
           (4) examine whether public transportation options can be 
        used more effectively to provide transportation services. 
        The commissioner must consult with transportation professionals 
        throughout the state in developing and preparing the report. 
           Sec. 52.  [AID REPAYMENT; LITTLE FALLS.] 
           Notwithstanding any law to the contrary, the department of 
        children, families, and learning must allow independent school 
        district No. 482, Little Falls, to repay over a five-year period 
        state aid overpayments for fiscal years 1998 and 1999 resulting 
        from the district's miscalculation of pupil units for those 
        years.  If this aid has already been recaptured, the department 
        shall make a positive aid adjustment of $500,000 in the July 15, 
        2001, aid payment to the district.  The school district must 
        repay the aid in equal payments of $100,000 each payable on June 
        20.  Payments must begin on June 20, 2002. 
           Sec. 53.  [REFERENDUM CONVERSION ADJUSTMENT FOR INTEREST 
        EARNED.] 
           (a) The commissioner of children, families, and learning 
        shall calculate the change in estimated net interest earnings 
        for each district attributable to the repeal of the general 
        education levy as provided in this section. 
           (b) The interest calculations must assume an annual 
        interest rate of five percent, and must be based on the amount 
        by which the district's cumulative net general education levy 
        receipts for taxes payable in 2000, based on the assumptions 
        specified in Minnesota Statutes, section 127A.45, subdivision 8, 
        exceeds the cumulative amount that would have been guaranteed 
        for each payment in fiscal year 2001, as defined in Minnesota 
        Statutes, section 127A.45, subdivisions 2 and 3, calculated 
        using data as of the June 20, 2001, payment, and assuming that 
        the repeal of the general education levy was effective for 
        fiscal year 2001.  The commissioner shall divide the interest 
        revenue in fiscal year 2001 by the number of resident marginal 
        cost pupil units in fiscal year 2001. 
           (c) The amount calculated in paragraph (a) may be converted 
        to an additional referendum allowance according to Minnesota 
        Statutes, section 126C.17, subdivision 11. 
           (d) Any additional referendum allowance as a result of a 
        conversion under paragraph (b) shall be included in the 
        referendum conversion allowance used to determine the referendum 
        allowance limit under Minnesota Statutes, section 126C.17, 
        subdivision 2. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2003 and later. 
           Sec. 54.  [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:  
             $3,364,596,000 .....     2002
             $3,506,910,000 .....     2003
           The 2002 appropriation includes $318,932,000 for 2001 and 
        $3,045,664,000 for 2002.  
           The 2003 appropriation includes $338,407,000 for 2002 and 
        $3,168,503,000 for 2003.  
           Subd. 3.  [TRANSPORTATION AID FOR ENROLLMENT OPTIONS.] For 
        transportation of pupils attending post-secondary institutions 
        according to Minnesota Statutes, section 124D.09, or for 
        transportation of pupils attending nonresident districts 
        according to Minnesota Statutes, sections 124D.03 and 124D.10: 
             $70,000        .....     2002
             $80,000        .....     2003
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 4.  [ABATEMENT AID.] For abatement aid according to 
        Minnesota Statutes, section 127A.49:  
             $7,098,000     .....     2002 
             $7,692,000     .....     2003 
           The 2002 appropriation includes $640,000 for 2001 and 
        $6,458,000 for 2002.  
           The 2003 appropriation includes $717,000 for 2002 and 
        $6,975,000 for 2003.  
           Subd. 5.  [NONPUBLIC PUPIL AID.] For nonpublic pupil 
        education aid according to Minnesota Statutes, sections 123.79 
        and 123B.40 to 123B.43: 
             $14,099,000    .....     2002 
             $16,472,000    .....     2003 
           The 2002 appropriation includes $1,330,000 for 2001 and 
        $12,769,000 for 2002. 
           The 2003 appropriation includes $1,419,000 for 2002 and 
        $15,053,000 for 2003. 
           Subd. 6.  [NONPUBLIC PUPIL TRANSPORTATION.] For nonpublic 
        pupil transportation aid under Minnesota Statutes, section 
        123B.92, subdivision 9: 
             $20,488,000     .....     2002 
             $24,802,000     .....     2003 
           The 2002 appropriation includes $2,000,000 for 2001 and 
        $18,488,000 for 2002. 
           The 2003 appropriation includes $2,054,000 for 2002 and 
        $22,748,000 for 2003. 
           Subd. 7.  [CONSOLIDATION TRANSITION AID.] For districts 
        consolidating under Minnesota Statutes, section 123A.485: 
             $675,000        .....     2002 
             $669,000        .....     2003 
           The 2002 appropriation includes $44,000 for 2001 and 
        $631,000 for 2002. 
           The 2003 appropriation includes $70,000 for 2002 and 
        $599,000 for 2003. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 8.  [TORNADO IMPACT; YELLOW MEDICINE EAST.] For a 
        grant to independent school district No. 2190, Yellow Medicine 
        East, for tornado impact declining enrollment aid: 
             $156,000     .....     2002
             $117,000     .....     2003
           Subd. 9.  [TORNADO IMPACT; ST. PETER.] For a grant to 
        independent school district No. 508, St. Peter, for tornado 
        impact declining enrollment aid: 
             $455,000     .....     2002 
           This grant is in lieu of funds authorized under Laws 1999, 
        chapter 241, article 4, section 22. 
           Subd. 10.  [ONE-ROOM SCHOOLHOUSE.] For a grant to 
        independent school district No. 690, Warroad, to operate the 
        Angle Inlet School: 
             $35,000      .....     2002 
             $35,000      .....     2003 
           This appropriation is one-time only. 
           Subd. 11.  [TRANSPORTATION STUDY.] For the costs of the 
        transportation study in section 52: 
             $10,000      .....     2002 
           Subd. 12.  [AID REPAYMENT; LITTLE FALLS.] For a positive 
        aid adjustment for school district No. 482, Little Falls: 
             $500,000     .....     2002 
           Sec. 55.  [REPEALER.] 
           Subdivision 1.  [EDUCATION REPEALERS.] (a) Minnesota 
        Statutes 2000, sections 124D.07; 126C.01, subdivision 10; 
        126C.16, subdivision 2; 126C.18; 126C.22; 126C.30; 126C.31; 
        126C.32; 126C.33; 126C.34; 126C.35; 126C.36; and 127A.44, are 
        repealed. 
           (b) Minnesota Statutes 2000, sections 126C.10, subdivisions 
        12 and 23; and 126C.17, subdivision 12, are repealed effective 
        for revenue for fiscal year 2002. 
           (c) Minnesota Statutes 2000, sections 126C.42, subdivisions 
        2 and 3; and 126C.47, are repealed effective for taxes payable 
        in 2002. 
           Subd. 2.  [TAX BILL PROVISIONS; REPEALED WITHOUT 
        EFFECT.] Notwithstanding Minnesota Statutes, chapter 645, or any 
        other law to the contrary, article 2, sections 1, 5, 7, 9, 10, 
        20, 21, and 23 of House File 1 if enacted during the 2001 First 
        Special Session, are repealed and the provisions are without 
        effect. 
           [EFFECTIVE DATE.] Subdivision 2 is effective the day 
        following final enactment. 

                                   ARTICLE 2 
                              EDUCATION EXCELLENCE 
           Section 1.  [120A.415] [EXTENDED SCHOOL CALENDAR.] 
           A school board that offers licensed kindergarten through 
        grade 12 teachers the opportunity for more staff development 
        training and additional salary under section 122A.40, 
        subdivisions 7 and 7a, or 122A.41, subdivisions 4 and 4a, must 
        adopt as its school calendar a total of 240 days of student 
        instruction and staff development, of which the total number of 
        staff development days equals the difference between the total 
        number of days of student instruction and 240 days.  A school 
        board may schedule additional staff development days throughout 
        the calendar year. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and thereafter. 
           Sec. 2.  Minnesota Statutes 2000, section 120B.13, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROGRAM STRUCTURE; TRAINING PROGRAMS FOR 
        TEACHERS.] (a) The advanced placement and international 
        baccalaureate programs are well-established academic programs 
        for mature, academically-directed high school students.  These 
        programs, in addition to providing academic rigor, offer sound 
        curricular design, accountability, comprehensive external 
        assessment, feedback to students and teachers, and the 
        opportunity for high school students to compete academically on 
        a global level.  Advanced placement and international 
        baccalaureate programs allow students to leave high school with 
        the academic skills and self-confidence to succeed in college 
        and beyond.  The advanced placement and international 
        baccalaureate programs help provide Minnesota students with 
        world-class educational opportunity. 
           (b) Critical to schools' educational success is ongoing 
        advanced placement/international baccalaureate-approved teacher 
        training.  A secondary teacher assigned by a district to teach 
        an advanced placement or international baccalaureate course or 
        other interested educator may participate in a training program 
        offered by the college board or International Baccalaureate 
        North America, Inc.  The state may pay a portion of the tuition, 
        room, and board costs a teacher or other interested educator 
        incurs in participating in a training program.  The commissioner 
        shall determine application procedures and deadlines, and select 
        teachers and other interested educators to participate in the 
        training program.  The procedures determined by the commissioner 
        shall, to the extent possible, ensure that advanced placement 
        and international baccalaureate courses become available in all 
        parts of the state and that a variety of course offerings are 
        available in school districts.  This subdivision does not 
        prevent teacher or other interested educator participation in 
        training programs offered by the college board or International 
        Baccalaureate North America, Inc., when tuition is paid by a 
        source other than the state. 
           Sec. 3.  [120B.15] [INVOLUNTARY CAREER TRACKING 
        PROHIBITED.] 
           A school district may develop grade-level curricula or 
        provide instruction that introduces students to various careers, 
        but must not require any curriculum, instruction, or 
        employment-related activity that obligates an elementary or 
        secondary student to involuntarily select a career, career 
        interest, employment goals, or related job training. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 4.  Minnesota Statutes 2000, section 120B.30, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [STATEWIDE TESTING.] (a) The commissioner, 
        with advice from experts with appropriate technical 
        qualifications and experience and stakeholders, shall include in 
        the comprehensive assessment system, for each grade level to be 
        tested, a test, which shall be aligned with the state's 
        graduation standards and administered annually to all students 
        in the third, fifth, seventh, and eighth grades.  The 
        commissioner shall establish one or more months during which 
        schools shall administer the tests to students each school 
        year.  Only Minnesota basic skills tests in reading, 
        mathematics, and writing shall fulfill students' basic skills 
        testing requirements for a passing state notation.  The passing 
        scores of the state tests in reading and mathematics are the 
        equivalent of:  
           (1) 70 percent correct for students entering grade 9 in 
        1996; and 
           (2) 75 percent correct for students entering grade 9 in 
        1997 and thereafter, as based on the first uniform test 
        administration of February 1998.  
           Notwithstanding Minnesota Rules, part 3501.0050, subpart 2, 
        at the written request of a parent or guardian, and with the 
        recommendation of the student's teacher, a district may offer 
        the test of basic requirements in reading, math, or writing to 
        an individual student beginning in grade 5.  The student must 
        take the same test on the same date as administered to students 
        in eighth grade or higher.  (b) Third and, fifth, and seventh 
        grade test results shall be available to districts for 
        diagnostic purposes affecting student learning and district 
        instruction and curriculum, and for establishing educational 
        accountability.  The commissioner must disseminate to the public 
        the third and, fifth, and seventh grade test results upon 
        receiving those results. 
           (b) (c) In addition, at the secondary high school level, 
        districts shall assess student performance in all required 
        learning areas and selected required standards within each area 
        of the profile of learning.  The testing instruments and, the 
        testing process, and the order of administration shall be 
        determined by the commissioner.  The results shall be aggregated 
        at the site and district level.  The testing shall be 
        administered beginning in the 1999-2000 school year and 
        thereafter. 
           (c) (d) The commissioner shall report school site and 
        school district student academic achievement levels of the 
        current and two immediately preceding school years.  The report 
        shall include students' unweighted mean test scores in each 
        tested subject, the unweighted mean test scores of only those 
        students enrolled in the school by January October 1 of the 
        previous current school year, and the unweighted test scores of 
        all students except those students receiving limited English 
        proficiency instruction.  The report also shall record 
        separately, in proximity to the reported performance levels, the 
        percentage of students of each gender and the percentages of 
        students who are eligible to receive a free or reduced price 
        school meal, demonstrate limited English proficiency, are 
        identified as migrant students, are a member of a major ethnic 
        or racial population, or are eligible to receive special 
        education services. 
           (d) (e) In addition to the testing and reporting 
        requirements under paragraphs (a), (b), and (c), and (d), the 
        commissioner shall include the following components in the 
        statewide public reporting system: 
           (1) uniform statewide testing of all third, fifth, seventh, 
        eighth, and post-eighth grade students that provides exemptions, 
        only with parent or guardian approval, for those very few 
        students for whom the student's individual education plan team 
        under sections 125A.05 and 125A.06, determines that the student 
        is incapable of taking a statewide test, or for a limited 
        English proficiency student under section 124D.59, subdivision 
        2, if the student has been in the United States for fewer than 
        12 months and for whom special language barriers exist, such as 
        the student's native language does not have a written form or 
        the district does not have access to appropriate interpreter 
        services for the student's native language; 
           (2) educational indicators that can be aggregated and 
        compared across school districts and across time on a statewide 
        basis, including average daily attendance, high school 
        graduation rates, and high school drop-out rates by age and 
        grade level; 
           (3) students' scores on the American College Test; and 
           (4) participation in the National Assessment of Educational 
        Progress so that the state can benchmark its performance against 
        the nation and other states, and, where possible, against other 
        countries, and contribute to the national effort to monitor 
        achievement. 
           (e) (f) Districts must report exemptions under paragraph 
        (d) (e), clause (1), to the commissioner consistent with a 
        format provided by the commissioner. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment except that the seventh grade testing 
        requirement applies to the 2002-2003 school year and later. 
           Sec. 5.  Minnesota Statutes 2000, section 120B.35, is 
        amended to read: 
           120B.35 [STUDENT ACADEMIC ACHIEVEMENT LEVELS AND PROGRESS.] 
           Subdivision 1.  [ADEQUATE YEARLY PROGRESS OF SCHOOLS AND 
        STUDENTS.] The commissioner must develop and implement a system 
        for measuring and reporting academic achievement and individual 
        student progress, consistent with the statewide educational 
        accountability and reporting system.  The components of the 
        system must measure the adequate yearly progress of schools and 
        individual students:  students' current achievement in schools 
        under subdivision 2; and individual students' educational 
        progress over time under subdivision 3.  The system also must 
        include statewide measures of student academic achievement that 
        identify schools with high levels of achievement, and also 
        schools with low levels of achievement that need improvement.  
        When determining a school's effect, the data must include both 
        statewide measures of student achievement and, to the extent 
        annual tests are administered, indicators of achievement growth 
        that take into account a student's prior achievement.  
        Indicators of achievement and prior achievement must be based on 
        highly reliable statewide or districtwide assessments.  
        Indicators that take into account a student's prior achievement 
        must not be used to disregard a school's low achievement or to 
        exclude a school from a program to improve low achievement 
        levels.  The commissioner by January 15, 2002, must submit a 
        plan for integrating these components to the chairs of the 
        legislative committees having policy and budgetary 
        responsibilities for elementary and secondary education.  
           Subd. 2.  [STUDENT ACADEMIC ACHIEVEMENT.] (a) Each school 
        year, a school district must determine if the student 
        achievement levels at each school site meet state and local 
        expectations.  If student achievement levels at a school site do 
        not meet state and local expectations and the site has not made 
        adequate yearly progress for two out of three consecutive school 
        years, beginning with the 2000-2001 2001-2002 school year, the 
        district must work with the school site to adopt a plan to raise 
        student achievement levels to meet state and local 
        expectations.  The legislature will determine state expectations 
        after receiving a recommendation from The commissioner of 
        children, families, and learning shall establish student 
        academic achievement levels.  
           (b) School sites identified as not meeting expectations 
        must develop continuous improvement plans in order to meet state 
        and local expectations for student academic achievement.  The 
        department, at a district's request, must assist the district 
        and the school site in developing a plan to improve student 
        achievement.  The plan must include parental involvement 
        components. 
           (c) The commissioner must: 
           (1) provide assistance to school sites and districts 
        identified as not meeting expectations; and 
           (2) provide technical assistance to schools that integrate 
        student progress measures under subdivision 3 in the school 
        continuous improvement plan. 
           (d) The commissioner shall establish and maintain a 
        continuous improvement Web site designed to make data on every 
        school and district available to parents, teachers, 
        administrators, community members, and the general public. 
           Subd. 3.  [STUDENT PROGRESS ASSESSMENT.] (a) The 
        educational assessment system component measuring individual 
        students' educational progress must be based, to the extent 
        annual tests are administered, on indicators of achievement 
        growth that show an individual student's prior achievement.  
        Indicators of achievement and prior achievement must be based on 
        highly reliable statewide or districtwide assessments.  
           (b) The commissioner must identify effective models for 
        measuring individual student progress that enable a school 
        district or school site to perform gains-based analysis, 
        including evaluating the effects of the teacher, school, and 
        school district on student achievement over time.  At least one 
        model must be a "value-added" assessment model that reliably 
        estimates those effects for classroom settings where a single 
        teacher teaches multiple subjects to the same group of students, 
        for team teaching arrangements, and for other teaching 
        circumstances. 
           (c) If a district has an accountability plan that includes 
        gains-based analysis or "value-added" assessment, the 
        commissioner shall, to the extent practicable, incorporate those 
        measures in determining whether the district or school site 
        meets expectations.  The department must coordinate with the 
        district in evaluating school sites and continuous improvement 
        plans, consistent with best practices.  
           Subd. 4.  [IMPROVING SCHOOLS.] Consistent with the 
        requirements of this section, the commissioner of children, 
        families, and learning must establish a second achievement 
        benchmark to identify improving schools.  The commissioner must 
        recommend to the legislature by February 15, 2002, indicators in 
        addition to the achievement benchmark for identifying improving 
        schools, including an indicator requiring a school to 
        demonstrate ongoing successful use of best teaching practices. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 6.  Minnesota Statutes 2000, section 121A.582, is 
        amended to read: 
           121A.582 [STUDENT DISCIPLINE; REASONABLE FORCE.] 
           Subdivision 1.  [REASONABLE FORCE STANDARD.] (a) A 
        teacher or school principal, in exercising the person's lawful 
        authority, may use reasonable force when it is necessary under 
        the circumstances to correct or restrain a student or prevent 
        bodily harm or death to another. 
           (b) A school employee, school bus driver, or other agent of 
        a district, in exercising the person's lawful authority, may use 
        reasonable force when it is necessary under the circumstances to 
        restrain a student or prevent bodily harm or death to another. 
           (c) Paragraphs (a) and (b) do not authorize conduct 
        prohibited under sections 121A.58 and 121A.67. 
           Subd. 2.  [CIVIL LIABILITY.] (a) A teacher or school 
        principal who, in the exercise of the person's lawful authority, 
        uses reasonable force under the standard in subdivision 1, 
        paragraph (a), has a defense against a civil action for damages 
        under section 123B.25. 
           (b) A school employee, bus driver, or other agent of a 
        district who, in the exercise of the person's lawful authority, 
        uses reasonable force under the standard in subdivision 1, 
        paragraph (b), has a defense against a civil action for damages 
        under section 123B.25. 
           Subd. 3.  [CRIMINAL PROSECUTION.] (a) A teacher or school 
        principal who, in the exercise of the person's lawful authority, 
        uses reasonable force under the standard in subdivision 1, 
        paragraph (a), has a defense against a criminal prosecution 
        under section 609.06, subdivision 1. 
           (b) A school employee, bus driver, or other agent of a 
        district who, in the exercise of the person's lawful authority, 
        uses reasonable force under the standard in subdivision 1, 
        paragraph (b), has a defense against a criminal prosecution 
        under section 609.06, subdivision 1. 
           Subd. 4.  [SUPPLEMENTARY RIGHTS AND DEFENSES.] Any right or 
        defense in this section is supplementary to those specified in 
        section 121A.58, 121A.67, 123B.25, or 609.06, subdivision 1. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 7.  Minnesota Statutes 2000, section 122A.18, 
        subdivision 2, is amended to read: 
           Subd. 2.  [TEACHER AND SUPPORT PERSONNEL QUALIFICATIONS.] 
        (a) The board of teaching must issue licenses under its 
        jurisdiction to persons the board finds to be qualified and 
        competent for their respective positions. 
           (b) The board must require a person to successfully 
        complete an examination of skills in reading, writing, and 
        mathematics before being granted an initial teaching license to 
        provide direct instruction to pupils in prekindergarten, 
        elementary, secondary, or special education programs.  The board 
        must require colleges and universities offering a board approved 
        teacher preparation program to provide remedial assistance that 
        includes a formal diagnostic component to persons enrolled in 
        their institution who did not achieve a qualifying score on the 
        skills examination, including those for whom English is a second 
        language.  The colleges and universities must provide assistance 
        in the specific academic areas of deficiency in which the person 
        did not achieve a qualifying score.  School districts must 
        provide similar, appropriate, and timely remedial assistance 
        that includes a formal diagnostic component and mentoring to 
        those persons employed by the district who completed their 
        teacher education program outside the state of Minnesota, 
        received a one-year license to teach in Minnesota and did not 
        achieve a qualifying score on the skills examination, including 
        those persons for whom English is a second language.  The board 
        of teaching shall report annually to the education committees of 
        the legislature on the total number of teacher candidates during 
        the most recent school year taking the skills examination, the 
        number who achieve a qualifying score on the examination, the 
        number who do not achieve a qualifying score on the examination, 
        the distribution of all candidates' scores, the number of 
        candidates who have taken the examination at least once before, 
        and the number of candidates who have taken the examination at 
        least once before and achieve a qualifying score.  
           (c) A person who has completed an approved teacher 
        preparation program and obtained a one-year license to teach, 
        but has not successfully completed the skills examination, may 
        renew the one-year license for two additional one-year periods.  
        Each renewal of the one-year license is contingent upon the 
        licensee: 
           (1) providing evidence of participating in an approved 
        remedial assistance program provided by a school district or 
        post-secondary institution that includes a formal diagnostic 
        component in the specific areas in which the licensee did not 
        obtain qualifying scores; and 
           (2) attempting to successfully complete the skills 
        examination during the period of each one-year license. 
           (d) The board of teaching must grant continuing licenses 
        only to those persons who have met board criteria for granting a 
        continuing license, which includes successfully completing the 
        skills examination in reading, writing, and mathematics. 
           (e) All colleges and universities approved by the board of 
        teaching to prepare persons for teacher licensure must include 
        in their teacher preparation programs a common core of teaching 
        knowledge and skills to be acquired by all persons recommended 
        for teacher licensure.  This common core shall meet the 
        standards developed by the interstate new teacher assessment and 
        support consortium in its 1992 "model standards for beginning 
        teacher licensing and development."  Amendments to standards 
        adopted under this paragraph are covered by chapter 14.  The 
        board of teaching shall report annually to the education 
        committees of the legislature on the performance of teacher 
        candidates on common core assessments of knowledge and skills 
        under this paragraph during the most recent school year. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and later. 
           Sec. 8.  Minnesota Statutes 2000, section 122A.24, 
        subdivision 3, is amended to read: 
           Subd. 3.  [PROGRAM APPROVAL.] (a) The board of teaching 
        must approve alternative preparation programs based on criteria 
        adopted by the board. 
           (b) An alternative preparation program at a school 
        district, group of schools, or an education district must be 
        affiliated with a post-secondary institution that has a teacher 
        preparation program.  The board shall permit demonstration of 
        licensure competencies in school-based and other nontraditional 
        pathways to teacher licensure. 
           Sec. 9.  Minnesota Statutes 2000, section 122A.25, is 
        amended by adding a subdivision to read: 
           Subd. 4.  [BACKGROUND CHECK.] A school district or charter 
        school shall provide the board of teaching with confirmation 
        that criminal background checks have been completed for all 
        nonlicensed community experts employed by the district or 
        charter school and approved by the board of teaching under this 
        section. 
           Sec. 10.  Minnesota Statutes 2000, section 122A.40, 
        subdivision 7, is amended to read: 
           Subd. 7.  [TERMINATION OF CONTRACT AFTER PROBATIONARY 
        PERIOD.] (a) A teacher who has completed a probationary period 
        in any district, and who has not been discharged or advised of a 
        refusal to renew the teacher's contract pursuant to under 
        subdivision 5, shall elect to have a continuing contract with 
        such district where contract terms and conditions, including 
        salary and salary increases, are established based either on the 
        length of the school calendar or an extended school calendar 
        under section 120A.415.  Thereafter, the teacher's contract must 
        remain in full force and effect, except as modified by mutual 
        consent of the board and the teacher, until terminated by a 
        majority roll call vote of the full membership of the board 
        prior to April 1 upon one of the grounds specified in 
        subdivision 9 or July 1 upon one of the grounds specified in 
        subdivision 10 or 11, or until the teacher is discharged 
        pursuant to subdivision 13, or by the written resignation of the 
        teacher submitted prior to April 1.  If an agreement as to the 
        terms and conditions of employment for the succeeding school 
        year has not been adopted pursuant to the provisions of sections 
        179A.01 to 179A.25 prior to March 1, the teacher's right of 
        resignation is extended to the 30th calendar day following the 
        adoption of said contract in compliance with section 179A.20, 
        subdivision 5.  Such written resignation by the teacher is 
        effective as of June 30 if submitted prior to that date and the 
        teachers' right of resignation for the school year then 
        beginning shall cease on July 15.  Before a teacher's contract 
        is terminated by the board, the board must notify the teacher in 
        writing and state its ground for the proposed termination in 
        reasonable detail together with a statement that the teacher may 
        make a written request for a hearing before the board within 14 
        days after receipt of such notification.  If the grounds are 
        those specified in subdivision 9 or 13, the notice must also 
        state a teacher may request arbitration under subdivision 15.  
        Within 14 days after receipt of this notification the teacher 
        may make a written request for a hearing before the board or an 
        arbitrator and it shall be granted upon reasonable notice to the 
        teacher of the date set for hearing, before final action is 
        taken.  If no hearing is requested within such period, it shall 
        be deemed acquiescence by the teacher to the board's action.  
        Such termination shall take effect at the close of the school 
        year in which the contract is terminated in the manner 
        aforesaid.  Such contract may be terminated at any time by 
        mutual consent of the board and the teacher and this section 
        does not affect the powers of a board to suspend, discharge, or 
        demote a teacher under and pursuant to other provisions of law. 
           (b) A teacher electing to have a continuing contract based 
        on the extended school calendar under section 120A.415 must 
        participate in staff development training under subdivision 7a 
        and shall receive an increased base salary. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and thereafter. 
           Sec. 11.  Minnesota Statutes 2000, section 122A.40, is 
        amended by adding a subdivision to read: 
           Subd. 7a.  [ADDITIONAL STAFF DEVELOPMENT AND SALARY.] (a) A 
        teacher electing to have a continuing contract based on the 
        extended school calendar under section 120A.415 must participate 
        in a total number of staff development days where the total 
        number of such days equals the difference between the total 
        number of days of student instruction and 240 days.  Staff 
        development includes peer mentoring, peer gathering, continuing 
        education, professional development, or other training.  A 
        school board may schedule such days throughout the calendar 
        year.  Staff development programs provided during such days 
        shall enable teachers to achieve the staff development outcomes 
        under section 122A.60, subdivision 3. 
           (b) A public employer and the exclusive representative of 
        the teachers must include terms in the collective bargaining 
        agreement for all teachers who participate in additional staff 
        development days under paragraph (a) that increase base salaries.
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and thereafter. 
           Sec. 12.  Minnesota Statutes 2000, section 122A.41, 
        subdivision 4, is amended to read: 
           Subd. 4.  [PERIOD OF SERVICE AFTER PROBATIONARY PERIOD; 
        DISCHARGE OR DEMOTION.] (a) After the completion of such 
        probationary period, without discharge, such teachers as are 
        thereupon reemployed shall continue in service and hold their 
        respective position during good behavior and efficient and 
        competent service and must not be discharged or demoted except 
        for cause after a hearing.  The terms and conditions of a 
        teacher's employment contract, including salary and salary 
        increases, must be based either on the length of the school year 
        or an extended school calendar under section 120A.415.  
           (b) A probationary teacher is deemed to have been 
        reemployed for the ensuing school year, unless the school board 
        in charge of such school gave such teacher notice in writing 
        before July 1 of the termination of such employment.  
           (c) A teacher electing to have an employment contract based 
        on the extended school calendar under section 120A.415 must 
        participate in staff development training under subdivision 4a 
        and shall receive an increased base salary. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and thereafter. 
           Sec. 13.  Minnesota Statutes 2000, section 122A.41, is 
        amended by adding a subdivision to read: 
           Subd. 4a.  [ADDITIONAL STAFF DEVELOPMENT AND SALARY.] (a) A 
        teacher electing to have a continuing contract based on the 
        extended school calendar under section 120A.415 must participate 
        in a total number of staff development days where the total 
        number of such days equals the difference between the total 
        number of days of student instruction and 240 days.  Staff 
        development includes peer mentoring, peer gathering, continuing 
        education, professional development, or other training.  A 
        school board may schedule such days throughout the calendar 
        year.  Staff development programs provided during such days 
        shall enable teachers to achieve the staff development outcomes 
        under section 122A.60, subdivision 3. 
           (b) A public employer and the exclusive representative of 
        the teachers must include terms in the collective bargaining 
        agreement for all teachers who participate in additional staff 
        development days under paragraph (a) that increase base salaries.
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and thereafter. 
           Sec. 14.  Minnesota Statutes 2000, section 122A.41, is 
        amended by adding a subdivision to read: 
           Subd. 5a.  [PROBATIONARY PERIOD FOR PRINCIPALS HIRED 
        INTERNALLY.] A board and the exclusive representative of the 
        school principals in the district may negotiate a plan for a 
        probationary period of up to two school years for licensed 
        teachers employed by the board who are subsequently employed by 
        the board as a licensed school principal. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and following. 
           Sec. 15.  Minnesota Statutes 2000, section 122A.41, 
        subdivision 7, is amended to read: 
           Subd. 7.  [HEARING OF CHARGES AGAINST TEACHER.] The charges 
        against a teacher must be in writing and signed by the person 
        making the same and then filed with the secretary or clerk of 
        the school board having charge of the school in which the 
        teacher is employed.  Before the school board, before 
        discharging or demoting discharges or demotes a teacher, must 
        then accord the teacher against whom charges have been filed a 
        full hearing and give to the teacher at least ten days' notice 
        in writing of the time and place of such hearing.  The notice 
        may be served personally or sent by certified mail addressed to 
        the teacher at the teacher's last known post office address. the 
        board must notify the teacher in writing and state in reasonable 
        detail its grounds for the proposed discharge or demotion, 
        together with a statement that the teacher may request in 
        writing within ten days after receiving the notice a hearing 
        before the board.  The board may have the notice served 
        personally or may send it by certified mail addressed to the 
        teacher at the teacher's last known post office address.  The 
        teacher, under subdivision 13, also may elect a hearing before 
        an arbitrator instead of the school board.  Within ten days 
        after receiving the notice the teacher may request in writing a 
        hearing before the board or an arbitrator and it shall be 
        granted.  The teacher must be given reasonable notice of the 
        time and place of the hearing before final action is taken.  A 
        teacher who fails to request a hearing within ten days is 
        considered to acquiesce in the board's action.  If the charge is 
        made by a person not connected with the school system the charge 
        may be disregarded by the school board.  If the grounds are 
        those specified in subdivision 6, clause (1), (2), (3), or (4), 
        the notice must also state a teacher may request arbitration 
        under subdivision 13.  At the hearing, the school board or 
        arbitrator shall hear all evidence that may be adduced in 
        support of the charges and for the teacher's defense to the 
        charges.  Either party has the right to have a written record of 
        the hearing at the expense of the board and to have witnesses 
        subpoenaed and all witnesses so subpoenaed must be examined 
        under oath.  Any member of the school board conducting such a 
        hearing has authority to issue subpoenas and to administer oaths 
        to witnesses. 
           [EFFECTIVE DATE.] This section is effective for the 
        2002-2003 school year and following. 
           Sec. 16.  Minnesota Statutes 2000, section 122A.41, 
        subdivision 13, is amended to read: 
           Subd. 13.  [HEARING AND DETERMINATION BY ARBITRATOR.] A 
        teacher against whom charges have been filed alleging any cause 
        for discharge or demotion specified in subdivision 6, clause 
        (1), (2), (3), or (4), may elect a hearing before an arbitrator 
        instead of the school board.  The hearing is governed by this 
        subdivision.  
           (a) The teacher must make a written request for a hearing 
        before an arbitrator within ten days after receiving a written 
        notice of the filing of charges required by subdivision 7.  
        Failure to request a hearing before an arbitrator during this 
        period is considered acquiescence to a hearing before the 
        board board's action. 
           (b) If the teacher and the school board are unable to 
        mutually agree on an arbitrator, the board must request from the 
        bureau of mediation services a list of five persons to serve as 
        an arbitrator.  If the teacher and the school board are unable 
        to mutually agree on an arbitrator from the list provided, the 
        parties shall alternately strike names from the list until the 
        name of one arbitrator remains.  The person remaining after the 
        striking procedure must be the arbitrator.  If the parties are 
        unable to agree on who shall strike the first name, the question 
        must be decided by a flip of a coin.  The teacher and the board 
        must share equally the costs and fees of the arbitrator. 
           (c) The arbitrator shall determine, by a preponderance of 
        the evidence, whether the causes specified in subdivision 6, 
        clause (1), (2), (3), or (4), exist to support the proposed 
        discharge or demotion.  A lesser penalty than discharge or 
        demotion may be imposed by the arbitrator only to the extent 
        that either party proposes such lesser penalty in the 
        proceeding.  In making the determination, the arbitration 
        proceeding is governed by sections 572.11 to 572.17 and by the 
        collective bargaining agreement applicable to the teacher. 
           (d) An arbitration hearing conducted under this subdivision 
        is a meeting for preliminary consideration of allegations or 
        charges within the meaning of section 13D.05, subdivision 3, 
        paragraph (a), and must be closed, unless the teacher requests 
        it to be open. 
           (e) The arbitrator's decision is final and binding on the 
        parties, subject to sections 572.18 to 572.26.  
           [EFFECTIVE DATE.] This section is effective for the 
        2002-2003 school year and following. 
           Sec. 17.  [122A.76] [BEST PRACTICES.] 
           "Best practices" means research-based proven practices.  
           Sec. 18.  Minnesota Statutes 2000, section 123B.03, 
        subdivision 3, is amended to read: 
           Subd. 3.  [DEFINITIONS.] For purposes of this section: 
           (a) "School" means a school as defined in section 120A.22, 
        subdivision 4, except a home-school, and includes a school 
        receiving tribal contract or grant school aid under section 
        124D.83; school, for the purposes of this section, also means a 
        service cooperative, a special education cooperative, or an 
        education district under Minnesota Statutes 1997 Supplement, 
        section 123.35, a charter school under section 124D.10, and a 
        joint powers district under section 471.59. 
           (b) "School hiring authority" means the school principal or 
        other person having general control and supervision of the 
        school. 
           Sec. 19.  Minnesota Statutes 2000, section 124D.03, 
        subdivision 4, is amended to read: 
           Subd. 4.  [DESEGREGATION DISTRICT TRANSFERS.] (a) This 
        subdivision applies to a transfer into or out of a district that 
        has a desegregation plan approved by the commissioner of 
        children, families, and learning.  
           (b) An application to transfer may be submitted at any time 
        for enrollment beginning at any time. 
           (c) The parent or guardian of a pupil who is a resident of 
        a district that has a desegregation plan must submit an 
        application to the resident district.  If the district accepts 
        the application, it must forward the application to the 
        nonresident district. 
           (d) The parent or guardian of a pupil who applies for 
        enrollment in a nonresident district that has a desegregation 
        plan must submit an application to the nonresident district.  
           (e) Each district must accept or reject an application it 
        receives and notify the parent or guardian in writing within 30 
        calendar days of receiving the application.  A notification of 
        acceptance must include the date enrollment can begin. 
           (f) If an application is rejected, the district must state 
        the reason for rejection in the notification.  If a district 
        that has a desegregation plan rejects an application for a 
        reason related to the desegregation plan, the district must 
        state with specificity how acceptance of the application would 
        result in noncompliance with department of children, families, 
        and learning rules with respect to the school or program for 
        which application was made.  
           (g) If an application is accepted, the parent or guardian 
        must notify the nonresident district in writing within 15 
        calendar days of receiving the acceptance whether the pupil 
        intends to enroll in the nonresident district.  Notice of 
        intention to enroll obligates the pupil to enroll in the 
        nonresident district, unless the boards of the resident and 
        nonresident districts agree otherwise.  If a parent or guardian 
        does not notify the nonresident district, the pupil may not 
        enroll in that nonresident district at that time, unless the 
        boards of the resident and nonresident district agree otherwise. 
           (h) Within 15 calendar days of receiving the notice from 
        the parent or guardian, the nonresident district shall notify 
        the resident district in writing of the pupil's intention to 
        enroll in the nonresident district.  
           (i) A pupil enrolled in a nonresident district under this 
        subdivision a desegregation plan approved by the commissioner of 
        children, families, and learning is not required to make annual 
        or periodic application for enrollment but may remain enrolled 
        in the same district.  A pupil may transfer to the resident 
        district at any time.  
           (d) Section 124D.03, subdivision 2, applies to a transfer 
        into or out of a district with a desegregation plan. 
           (j) A pupil enrolled in a nonresident district and applying 
        to transfer into or out of a district that has a desegregation 
        plan must follow the procedures of this subdivision.  For the 
        purposes of this type of transfer, "resident district" means the 
        nonresident district in which the pupil is enrolled at the time 
        of application.  
           (k) A district that has a desegregation plan approved by 
        the commissioner must accept or reject each individual 
        application in a manner that will enable compliance with its 
        desegregation plan. 
           Sec. 20.  Minnesota Statutes 2000, section 124D.10, is 
        amended by adding a subdivision to read: 
           Subd. 3a.  [CONFLICT OF INTEREST.] (a) A member of a 
        charter school board of directors is prohibited from serving as 
        a member of the board of directors or as an employee or agent of 
        or a contractor with a for-profit entity with whom the charter 
        school contracts, directly or indirectly, for professional 
        services, goods, or facilities.  A violation of this prohibition 
        renders a contract voidable at the option of the commissioner.  
        A member of a charter school board of directors who violates 
        this prohibition shall be individually liable to the charter 
        school for any damage caused by the violation.  
           (b) An individual may serve as a member of the board of 
        directors if no conflict of interest under paragraph (a) exists. 
           (c) A member of a charter school board of directors that 
        serves as a member of the board of directors or as an employee 
        or agent of or a contractor with a nonprofit entity with whom 
        the charter school contracts, directly or indirectly, for 
        professional services, goods, or facilities, must disclose all 
        potential conflicts to the commissioner. 
           (d) The conflict of interest provisions under this 
        subdivision do not apply to compensation paid to a teacher 
        employed by the charter school who also serves as a member of 
        the board of directors. 
           (e) The conflict of interest provisions under this 
        subdivision do not apply to a teacher who provides services to a 
        charter school through a cooperative formed under chapter 308A 
        when the teacher also serves on the charter school board of 
        directors. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and following. 
           Sec. 21.  Minnesota Statutes 2000, section 124D.10, 
        subdivision 4, is amended to read: 
           Subd. 4.  [FORMATION OF SCHOOL.] (a) A sponsor may 
        authorize one or more licensed teachers under section 122A.18, 
        subdivision 1, to operate a charter school subject to approval 
        by the commissioner.  A board must vote on charter school 
        application for sponsorship no later than 90 days after 
        receiving the application.  After 90 days, the applicant may 
        apply to the commissioner.  If a board elects not to sponsor a 
        charter school, the applicant may appeal the board's decision to 
        the commissioner.  If the commissioner authorizes the school, 
        the commissioner must sponsor the school according to this 
        section The commissioner may elect to sponsor the charter school 
        or assist the applicant in finding an eligible sponsor.  The 
        school must be organized and operated as a cooperative under 
        chapter 308A or nonprofit corporation under chapter 317A and the 
        provisions under the applicable chapter shall apply to the 
        school except as provided in this section.  Notwithstanding 
        sections 465.717 and 465.719, a school district may create a 
        corporation for the purpose of creating a charter school.  
           (b) Before the operators may form and operate a school, the 
        sponsor must file an affidavit with the commissioner stating its 
        intent to authorize a charter school.  The affidavit must state 
        the terms and conditions under which the sponsor would authorize 
        a charter school.  The commissioner must approve or disapprove 
        the sponsor's proposed authorization within 60 days of receipt 
        of the affidavit.  Failure to obtain commissioner approval 
        precludes a sponsor from authorizing the charter school that was 
        the subject of the affidavit.  
           (c) The operators authorized to organize and operate a 
        school, before entering into a contract or other agreement for 
        professional or other services, goods, or facilities, must hold 
        an election for members of the school's board of directors in a 
        timely manner after the school is operating incorporate as a 
        cooperative under chapter 308A or as a nonprofit corporation 
        under chapter 317A and must establish a board of directors 
        composed of at least five members until a timely election for 
        members of the charter school board of directors is held 
        according to the school's articles and bylaws.  A charter school 
        board of directors must be composed of at least five members.  
        Any staff members who are employed at the school, including 
        teachers providing instruction under a contract with a 
        cooperative, and all parents of children enrolled in the school 
        may participate in the election for members of the school's 
        board of directors.  Licensed teachers employed at the school, 
        including teachers providing instruction under a contract with a 
        cooperative, must be a majority of the members of the board of 
        directors before the school completes its third year of 
        operation, unless the commissioner waives the requirement 
        for the school a majority of licensed teachers on the board.  A 
        provisional board may operate before the election of the 
        school's board of directors.  Board of director meetings must 
        comply with chapter 13D. 
           (d) The granting or renewal of a charter by a sponsoring 
        entity must not be conditioned upon the bargaining unit status 
        of the employees of the school.  
           (e) The commissioner annually must provide timely financial 
        management training to newly elected members of a charter school 
        board of directors and ongoing training to other members of a 
        charter school board of directors.  Training must address ways 
        to: 
           (1) proactively assess opportunities for a charter school 
        to maximize all available revenue sources; 
           (2) establish and maintain complete, auditable records for 
        the charter school; 
           (3) establish proper filing techniques; 
           (4) document formal actions of the charter school, 
        including meetings of the charter school board of directors; 
           (5) properly manage and retain charter school and student 
        records; 
           (6) comply with state and federal payroll recordkeeping 
        requirements; and 
           (7) address other similar factors that facilitate 
        establishing and maintaining complete records on the charter 
        school's operations.  
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and later. 
           Sec. 22.  Minnesota Statutes 2000, section 124D.10, is 
        amended by adding a subdivision to read: 
           Subd. 6a.  [AUDIT REPORT.] The charter school must submit 
        an audit report to the commissioner by December 31 each year.  
        The charter school, with the assistance of the auditor 
        conducting the audit, must include with the report a copy of all 
        charter school agreements for corporate management services.  If 
        the entity that provides the professional services to the 
        charter school is exempt from taxation under section 501 of the 
        Internal Revenue Code of 1986, that entity must file with the 
        commissioner by February 15 a copy of the annual return required 
        under section 6033 of the Internal Revenue Code of 1986.  If the 
        commissioner receives as part of the audit report a management 
        letter indicating that a material weakness exists in the 
        financial reporting systems of a charter school, the charter 
        school must submit a written report to the commissioner 
        explaining how the material weakness will be resolved.  Upon the 
        request of an individual, the charter school must make available 
        in a timely fashion the minutes of meetings of members, the 
        board of directors, and committees having any of the authority 
        of the board of directors, and statements showing the financial 
        result of all operations and transactions affecting income and 
        surplus during the school's last annual accounting period and a 
        balance sheet containing a summary of its assets and liabilities 
        as of the closing date of the accounting period.  
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and later. 
           Sec. 23.  Minnesota Statutes 2000, section 124D.10, 
        subdivision 8, is amended to read: 
           Subd. 8.  [STATE AND LOCAL REQUIREMENTS.] (a) A charter 
        school shall meet all applicable state and local health and 
        safety requirements. 
           (b) A school sponsored by a school board may be located in 
        any district, unless the school board of the district of the 
        proposed location disapproves by written resolution.  If such a 
        board denies a request to locate within its boundaries a charter 
        school sponsored by another school board, the sponsoring school 
        board may appeal to the commissioner.  If the commissioner 
        authorizes the school, the commissioner must 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 must 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 must comply with 
        chapter 363 and section 121A.04. 
           (h) A charter school is subject to and must comply with the 
        Pupil Fair Dismissal Act, sections 121A.40 to 121A.56, and the 
        Minnesota Public School Fee Law, sections 123B.34 to 123B.39. 
           (i) A charter school is subject to the same financial 
        audits, audit procedures, and audit requirements as a district.  
        Audits must be conducted in compliance with generally accepted 
        governmental auditing standards, the Federal Single Audit Act, 
        if applicable, and section 6.65.  A charter school is subject to 
        and must comply with sections 15.054; 118A.01; 118A.02; 118A.03; 
        118A.04; 118A.05; 118A.06; 123B.52, subdivision 5; 471.38; 
        471.391; 471.392; 471.425; 471.87; 471.88, subdivisions 1, 2, 3, 
        4, 5, 6, 12, 13, and 15; 471.881; and 471.89.  The audit must 
        comply with the requirements of sections 123B.75 to 123B.83, 
        except to the extent deviations are necessary because of the 
        program at the school.  Deviations must be approved by the 
        commissioner.  The department of children, families, and 
        learning, state auditor, or legislative auditor may conduct 
        financial, program, or compliance audits.  A charter school 
        determined to be in statutory operating debt under sections 
        123B.81 to 123B.83 must submit a plan under section 123B.81, 
        subdivision 4. 
           (j) A charter school is a district for the purposes of tort 
        liability under chapter 466. 
           Sec. 24.  Minnesota Statutes 2000, section 124D.10, 
        subdivision 15, is amended to read: 
           Subd. 15.  [REVIEW AND COMMENT.] The department must review 
        and comment on the evaluation, by the sponsor, of the 
        performance of a charter school before the charter school's 
        contract is renewed.  A sponsor shall monitor and evaluate the 
        fiscal and student performance of the school, and may for this 
        purpose annually assess the school a charter school:  (1) in its 
        first, second, or third year of operation up to $10 $30 per 
        student up to a maximum of $3,500 $10,000; and (2) in its fourth 
        or a subsequent year of operation up to $10 per student up to a 
        maximum of $3,500.  The information for the review and comment 
        shall be reported by the sponsor to the commissioner of 
        children, families, and learning in a timely manner.  
        Periodically, the commissioner shall report trends or 
        suggestions based on the evaluation of charter school contracts 
        to the education committees of the state legislature.  
           Sec. 25.  Minnesota Statutes 2000, section 124D.10, is 
        amended by adding a subdivision to read: 
           Subd. 23a.  [RELATED PARTY LEASE COSTS.] (a) A charter 
        school is prohibited from entering a lease of real property with 
        a related party as defined in this subdivision, unless the 
        lessor is a nonprofit corporation under chapter 317A or a 
        cooperative under chapter 308A, and the lease cost is reasonable 
        under section 124D.11, subdivision 4, clause (1). 
           (b) For purposes of this subdivision: 
           (1) A "related party" is an affiliate or close relative of 
        the other party in question, an affiliate of a close relative, 
        or a close relative of an affiliate.  
           (2) "Affiliate" means a person that directly, or indirectly 
        through one or more intermediaries, controls, or is controlled 
        by, or is under common control with, another person. 
           (3) "Close relative" means an individual whose relationship 
        by blood, marriage, or adoption to another individual is no more 
        remote than first cousin. 
           (4) "Person" means an individual or entity of any kind. 
           (5) "Control" includes the terms "controlling," "controlled 
        by," and "under common control with" and means the possession, 
        direct or indirect, of the power to direct or cause the 
        direction of the management, operations, or policies of a 
        person, whether through the ownership of voting securities, by 
        contract, or otherwise. 
           (c) A lease of real property to be used for a charter 
        school, not excluded in paragraph (b), must contain the 
        following statement:  "This lease is subject to Minnesota 
        Statutes, section 124D.10, subdivision 23a." 
           (d) If a charter school enters into as lessee a lease with 
        a related party and the charter school subsequently closes, the 
        commissioner has the right to recover from the lessor any lease 
        payments in excess of those that are reasonable under section 
        124.11, subdivision 4, clause (1). 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment and applies to any charter school 
        lease entered into on or after that date. 
           Sec. 26.  Minnesota Statutes 2000, section 124D.10, is 
        amended by adding a subdivision to read: 
           Subd. 26.  [CHARTER SCHOOL ADVISORY COUNCIL.] A charter 
        school advisory council is established under section 15.059.  
        The advisory council is composed of seven members from 
        throughout the state who have demonstrated experience with or 
        interest in charter schools.  The advisory council shall bring 
        to the attention of the commissioner any matters related to 
        charter schools that the council deems necessary and shall: 
           (1) encourage school boards to make full use of charter 
        school opportunities; 
           (2) encourage the creation of innovative schools; 
           (3) provide leadership and support for charter school 
        sponsors to increase the innovation in and the effectiveness, 
        accountability, and fiscal soundness of charter schools; 
           (4) serve an ombudsman function in facilitating the 
        operations of new and existing charter schools; 
           (5) promote timely financial management training for newly 
        elected members of a charter school board of directors and 
        ongoing training for other members of a charter school board of 
        directors; 
           (6) review charter school applications and recommend 
        approving or disapproving the applications; and 
           (7) facilitate compliance with auditing and other reporting 
        requirements.  The advisory council shall refer all its 
        proposals to the commissioner who shall provide time for reports 
        from the council. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 27.  Minnesota Statutes 2000, section 124D.11, 
        subdivision 4, is amended to read: 
           Subd. 4.  [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 126C.10, subdivision 13, 
        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 126C.40, subdivision 1, 
        paragraphs (a) and (b).  The commissioner must review and either 
        approve or deny a lease aid application using the following 
        criteria: 
           (1) the reasonableness of the price based on current market 
        values; 
           (2) the extent to which the lease conforms to applicable 
        state laws and rules; and 
           (3) the appropriateness of the proposed lease in the 
        context of the space needs and financial circumstances of the 
        charter school. 
        A charter school must not use the building lease aid it receives 
        for custodial, maintenance service, utility, or other operating 
        costs.  The amount of building lease aid per pupil unit served 
        for a charter school for any year shall not exceed the lesser of 
        (a) 90 percent of the approved cost or (b) the product of the 
        pupil units served for the current school year times $1,500. 
           Sec. 28.  Minnesota Statutes 2000, section 124D.11, 
        subdivision 9, is amended to read: 
           Subd. 9.  [PAYMENT OF AIDS TO CHARTER SCHOOLS.] (a) 
        Notwithstanding section 127A.45, subdivision 3, aid payments for 
        the current fiscal year to a charter school not in its first 
        year of operation shall be of an equal amount on each of the 23 
        payment dates.  A charter school in its first year of operation 
        shall receive, on its first payment date, ten percent of its 
        cumulative amount guaranteed for the year and 22 payments of an 
        equal amount thereafter the sum of which shall be 90 percent of 
        the cumulative amount guaranteed. 
           (b) Notwithstanding paragraph (a), for a charter school 
        ceasing operation prior to the end of a school year, 90 percent 
        of the amount due for the school year may be paid to the school 
        after audit of prior fiscal year and current fiscal year pupil 
        counts. 
           (c) Notwithstanding section 127A.45, subdivision 3, and 
        paragraph (a), 90 percent of the start-up cost aid under 
        subdivision 8 shall be paid within 45 days after the first day 
        of student attendance for that school year. 
           (d) In order to receive state aid payments under this 
        subdivision, a charter school in its first three years of 
        operation must submit a quarterly report to the department of 
        children, families, and learning.  The report must list each 
        student by grade, show the student's start and end dates, if 
        any, with the charter school, and for any student participating 
        in a learning year program, the report must list the hours and 
        times of learning year activities.  The report must be submitted 
        not more than two weeks after the end of the calendar quarter to 
        the department.  The department must develop a Web-based 
        reporting form for charter schools to use when submitting 
        enrollment reports.  A charter school in its fourth and 
        subsequent year of operation must submit enrollment information 
        to the department in the form and manner requested by the 
        department. 
           Sec. 29.  Minnesota Statutes 2000, section 124D.128, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROGRAM ESTABLISHED.] A learning year 
        program provides instruction throughout the year.  A pupil may 
        participate in the program and accelerate attainment of grade 
        level requirements or graduation requirements.  A learning year 
        program may begin after the close of the regular school year in 
        June.  The program may be for students in one or more grade 
        levels from kindergarten through grade 12.  
           Students may participate in the program if they reside in:  
           (1) a district that has been designated a learning year 
        site under subdivision 2; 
           (2) a district that is a member of the same education 
        district as a site; or 
           (3) a district that participates in the same area learning 
        center program as a site.  
           Sec. 30.  Minnesota Statutes 2000, section 124D.128, 
        subdivision 2, is amended to read: 
           Subd. 2.  [COMMISSIONER DESIGNATION.] (a) An area learning 
        center designated by the state must be a site.  To be 
        designated, a district or center must demonstrate to the 
        commissioner that it will: 
           (1) provide a program of instruction that permits pupils to 
        receive instruction throughout the entire year; and 
           (2) maintain a record system that, for purposes of section 
        126C.05, permits identification of membership attributable to 
        pupils participating in the program.  The record system and 
        identification must ensure that the program will not have the 
        effect of increasing the total number of pupil units 
        attributable to an individual pupil as a result of a learning 
        year program.  The record system must include the date the pupil 
        originally enrolled in a learning year program, the pupil's 
        grade level, the date of each grade promotion, the average daily 
        membership generated in each grade level, the number of credits 
        or standards earned, and the number needed to graduate. 
           (b) A student who has not completed a school district's 
        graduation requirements may continue to enroll in courses the 
        student must complete in order to graduate until the student 
        satisfies the district's graduation requirements or the student 
        is 21 years old, whichever comes first. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 31.  Minnesota Statutes 2000, section 124D.128, 
        subdivision 3, is amended to read: 
           Subd. 3.  [STUDENT PLANNING.] A district must inform all 
        pupils and their parents about the learning year program and 
        that participation in the program is optional.  A continual 
        learning plan must be developed at least annually for each pupil 
        with the participation of the pupil, parent or guardian, 
        teachers, and other staff; each participant must sign and date 
        the plan.  The plan must specify the learning experiences that 
        must occur each during the entire fiscal year and, for secondary 
        students, for graduation.  The plan must include:  
           (1) the pupil's learning objectives and experiences, 
        including courses or credits the pupil plans to complete each 
        year and, for a secondary pupil, the graduation requirements the 
        student must complete; 
           (2) the assessment measurements used to evaluate a pupil's 
        objectives; 
           (3) requirements for grade level or other appropriate 
        progression; and 
           (4) for pupils generating more than one average daily 
        membership in a given grade, an indication of which objectives 
        were unmet. 
        The plan may be modified to conform to district schedule 
        changes.  The district may not modify the plan if the 
        modification would result in delaying the student's time of 
        graduation.  
           Sec. 32.  Minnesota Statutes 2000, section 124D.128, 
        subdivision 6, is amended to read: 
           Subd. 6.  [REVENUE COMPUTATION AND REPORTING.] Aid and levy 
        revenue computations must be based on the total number of hours 
        of education programs for pupils in average daily membership for 
        each fiscal year.  For purposes of section 126C.05, Average 
        daily membership shall be computed by dividing the total number 
        of hours of participation for the fiscal year by the minimum 
        number of hours for a year determined for the appropriate grade 
        level under section 126C.05, subdivision 15.  Hours of 
        participation that occur after the close of the regular 
        instructional year and before July 1 must be attributed to the 
        following fiscal year.  Thirty hours may be used for teacher 
        workshops, staff development, or parent-teacher conferences.  As 
        part of each pilot program, the department and each district 
        must report and evaluate the changes needed to adjust the dates 
        of the fiscal year for aid and levy computation and fiscal year 
        reporting.  For revenue computation purposes, the learning year 
        program shall generate revenue based on the formulas for the 
        fiscal year in which the services are provided.  The dates a 
        participating pupil is promoted must be reported in a timely 
        manner to the department. 
           State aid and levy revenue computation for the learning 
        year programs begins July 1, 1988, for fiscal year 1989.  
           Sec. 33.  Minnesota Statutes 2000, section 124D.128, is 
        amended by adding a subdivision to read: 
           Subd. 6a.  [PROCESS TO ADDRESS AUDIT FINDINGS.] (a) If, 
        during an audit of a district's learning year program, the 
        commissioner finds that the district is not meeting program 
        requirements, the commissioner must notify the board of that 
        district in writing.  The notice must specify the findings in 
        detail, describe the correction required, set a reasonable time 
        during which the findings should be corrected, and advise that 
        general education revenue to the district may be reduced.  The 
        commissioner may extend the time allowed for the correction. 
           (b) A board that receives a notice under paragraph (a) may 
        decide by majority vote of the entire board to dispute that: 
           (1) the specified finding exists; 
           (2) the time allowed is reasonable; or 
           (3) the commissioner should reduce district general 
        education revenue. 
           The board must give the commissioner written notice of the 
        board's decision within 30 days of receipt of the audit report.  
        After making any further investigations the commissioner deems 
        necessary, the commissioner must decide whether or not to adhere 
        to the commissioner's original notice and must notify the board 
        of the commissioner's decision. 
           (c) The commissioner may reduce or withhold state general 
        education revenues as the result of an audit.  The commissioner 
        may decide not to reduce or withhold state general education 
        revenues if the district corrects the specified finding, or 
        after receiving the district's notice disputing the finding, the 
        commissioner decides the finding does not exist. 
           Sec. 34.  Minnesota Statutes 2000, section 124D.74, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PROGRAM DESCRIBED.] American Indian 
        language and culture education programs are programs in public 
        elementary and secondary schools, nonsectarian nonpublic, 
        community, tribal, or alternative schools enrolling American 
        Indian children designed to: 
           (1) to support post-secondary preparation for pupils; 
           (2) support the academic achievement of American Indian 
        students with identified focus to improve reading and mathematic 
        skills; 
           (3) make the curriculum more relevant to the needs, 
        interests, and cultural heritage of American Indian pupils; 
           (2) to (4) provide positive reinforcement of the self-image 
        of American Indian pupils; and 
           (3) to (5) develop intercultural awareness among pupils, 
        parents, and staff; and 
           (6) supplement, not supplant, state and federal educational 
        and cocurricular programs.  
        Program components may include:  instruction in American Indian 
        language, literature, history, and culture development of 
        support components for students in the areas of academic 
        achievement, retention, and attendance; development of support 
        components for staff, including in-service training and 
        technical assistance in methods of teaching American Indian 
        pupils; research projects, including experimentation with and 
        evaluation of methods of relating to American Indian pupils; 
        provision of personal and vocational counseling to American 
        Indian pupils; modification of curriculum, instructional 
        methods, and administrative procedures to meet the needs of 
        American Indian pupils; and establishment of cooperative 
        liaisons with nonsectarian nonpublic, community, tribal or 
        alternative schools offering curricula which reflect American 
        Indian culture supplemental instruction in American Indian 
        language, literature, history, and culture.  Districts offering 
        programs may make contracts for the provision of program 
        components by nonsectarian nonpublic, community, tribal or 
        alternative schools establishing cooperative liaisons with 
        tribal programs and American Indian social service agencies.  
        These programs may also be provided as components of early 
        childhood and family education programs. 
           Sec. 35.  Minnesota Statutes 2000, section 124D.74, 
        subdivision 2, is amended to read: 
           Subd. 2.  [VOLUNTARY ENROLLMENT.] Enrollment in American 
        Indian language and culture education programs must be 
        voluntary.  School districts and participating schools must make 
        affirmative efforts to encourage participation.  They shall 
        encourage parents to visit classes or come to school for a 
        conference explaining the nature of the program and provide 
        visits by school staff to parents' homes to explain the nature 
        of the program. 
           Sec. 36.  Minnesota Statutes 2000, section 124D.74, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ENROLLMENT OF OTHER CHILDREN; SHARED TIME 
        ENROLLMENT.] To the extent it is economically feasible, a 
        district or participating school may make provision for the 
        voluntary enrollment of non-American Indian children in the 
        instructional components of an American Indian language and 
        culture education program in order that they may acquire an 
        understanding of the cultural heritage of the American Indian 
        children for whom that particular program is designed.  However, 
        in determining eligibility to participate in a program, priority 
        must be given to American Indian children.  American Indian 
        children and other children enrolled in an existing nonpublic 
        school system may be enrolled on a shared time basis in American 
        Indian language and culture education programs. 
           Sec. 37.  Minnesota Statutes 2000, section 124D.74, 
        subdivision 4, is amended to read: 
           Subd. 4.  [LOCATION OF PROGRAMS.] American Indian language 
        and culture education programs must be located in facilities in 
        which regular classes in a variety of subjects are offered on a 
        daily basis.  Programs may operate on an extended day or 
        extended year basis. 
           Sec. 38.  Minnesota Statutes 2000, section 124D.74, 
        subdivision 6, is amended to read: 
           Subd. 6.  [NONVERBAL COURSES AND EXTRACURRICULAR 
        ACTIVITIES.] In predominantly nonverbal subjects, such as art, 
        music, and physical education, American Indian children shall 
        participate fully and on an equal basis with their 
        contemporaries in school classes provided for these subjects.  
        Every school district or participating school shall ensure to 
        children enrolled in American Indian language and culture 
        education programs an equal and meaningful opportunity to 
        participate fully with other children in all extracurricular 
        activities.  This subdivision shall not be construed to prohibit 
        instruction in nonverbal subjects or extracurricular activities 
        which relate to the cultural heritage of the American Indian 
        children, or which are otherwise necessary to accomplish the 
        objectives described in sections 124D.71 to 124D.82. 
           Sec. 39.  Minnesota Statutes 2000, section 124D.75, 
        subdivision 6, is amended to read: 
           Subd. 6.  [PERSONS ELIGIBLE FOR EMPLOYMENT; EXEMPTIONS.] 
        Any person licensed under this section shall be eligible for 
        employment by a school board or a participating school as a 
        teacher in an American Indian language and culture education 
        program in which the American Indian language or culture in 
        which the person is licensed is taught.  A school district or 
        participating school may prescribe only those additional 
        qualifications for teachers licensed under this section as are 
        approved by the board of teaching.  Any school board or 
        participating school upon request may be exempted from the 
        licensure requirements of this section in the hiring of one or 
        more American Indian language and culture education teachers for 
        any school year in which compliance would, in the opinion of the 
        commissioner, create a hardship in the securing of the teachers. 
           Sec. 40.  Minnesota Statutes 2000, section 124D.76, is 
        amended to read: 
           124D.76 [TEACHERS AIDES; COMMUNITY COORDINATORS.] 
           In addition to employing American Indian language and 
        culture education teachers, each district or participating 
        school providing programs pursuant to sections 124D.71 to 
        124D.82 may employ teachers' aides.  Teachers' aides must not be 
        employed for the purpose of supplanting American Indian language 
        and culture education teachers. 
           Any district or participating school which conducts 
        American Indian language and culture education programs pursuant 
        to sections 124D.71 to 124D.82 must employ one or more full-time 
        or part-time community coordinators if there are 100 or more 
        students enrolled in the program.  Community coordinators shall 
        promote communication understanding, and cooperation between the 
        schools and the community and shall visit the homes of children 
        who are to be enrolled in an American Indian language and 
        culture education program in order to convey information about 
        the program. 
           Sec. 41.  Minnesota Statutes 2000, section 124D.78, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [PARENT COMMITTEE.] School boards and 
        American Indian schools must provide for the maximum involvement 
        of parents of children enrolled in education programs, including 
        language and culture education programs, programs for elementary 
        and secondary grades, special education programs, and support 
        services.  Accordingly, the board of a school district in which 
        there are ten or more American Indian children enrolled and each 
        American Indian school must establish a parent committee.  If a 
        committee whose membership consists of a majority of parents of 
        American Indian children has been or is established according to 
        federal, tribal, or other state law, that committee may serve as 
        the committee required by this section and is subject to, at 
        least, the requirements of this subdivision and subdivision 2.  
           The parent committee must develop its recommendations in 
        consultation with the curriculum advisory committee required by 
        section 120B.11, subdivision 3.  This committee must afford 
        parents the necessary information and the opportunity 
        effectively to express their views concerning all aspects of 
        American Indian education and the educational needs of the 
        American Indian children enrolled in the school or program.  The 
        committee must also address the need for adult education 
        programs for American Indian people in the community.  The board 
        or American Indian school must ensure that programs are planned, 
        operated, and evaluated with the involvement of and in 
        consultation with parents of children served by the programs.  
           Sec. 42.  Minnesota Statutes 2000, section 124D.81, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [GRANTS; PROCEDURES.] Each fiscal year the 
        commissioner of children, families, and learning must make 
        grants to no fewer than six American Indian language and culture 
        education programs.  At least three programs must be in urban 
        areas and at least three must be on or near reservations.  The 
        board of a local district, a participating school or a group of 
        boards may develop a proposal for grants in support of American 
        Indian language and culture education programs.  Proposals may 
        provide for contracts for the provision of program components by 
        nonsectarian nonpublic, community, tribal, or alternative 
        schools.  The commissioner shall prescribe the form and manner 
        of application for grants, and no grant shall be made for a 
        proposal not complying with the requirements of sections 124D.71 
        to 124D.82.  The commissioner must submit all proposals to the 
        state advisory task force committee on American Indian language 
        and culture education programs for its recommendations 
        concerning approval, modification, or disapproval and the 
        amounts of grants to approved programs. 
           Sec. 43.  Minnesota Statutes 2000, section 124D.81, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ADDITIONAL REQUIREMENTS.] Each district 
        receiving a grant under this section must each year conduct a 
        count of American Indian children in the schools of the 
        district; test for achievement; identify the extent of other 
        educational needs of the children to be enrolled in the American 
        Indian language and culture education program; and classify the 
        American Indian children by grade, level of educational 
        attainment, age and achievement.  Participating schools must 
        maintain records concerning the needs and achievements of 
        American Indian children served. 
           Sec. 44.  Minnesota Statutes 2000, section 124D.81, 
        subdivision 5, is amended to read: 
           Subd. 5.  [RECORDS.] Participating schools and districts 
        must keep records and afford access to them as the commissioner 
        finds necessary to ensure that American Indian language and 
        culture education programs are implemented in conformity with 
        sections 124D.71 to 124D.82.  Each school district or 
        participating school must keep accurate, detailed, and separate 
        revenue and expenditure accounts for pilot American Indian 
        language and culture education programs funded under this 
        section. 
           Sec. 45.  Minnesota Statutes 2000, section 124D.81, 
        subdivision 6, is amended to read: 
           Subd. 6.  [MONEY FROM OTHER SOURCES.] A district or 
        participating school providing American Indian language and 
        culture education programs shall be eligible to receive moneys 
        for these programs from other government agencies and from 
        private sources when the moneys are available. 
           Sec. 46.  Minnesota Statutes 2000, section 124D.81, 
        subdivision 7, is amended to read: 
           Subd. 7.  [EXCEPTIONS.] Nothing in sections 124D.71 to 
        124D.82 shall be construed as prohibiting a district or school 
        from implementing an American Indian language and culture 
        education program which is not in compliance with sections 
        124D.71 to 124D.82 if the proposal and plan for that program is 
        not funded pursuant to this section. 
           Sec. 47.  Minnesota Statutes 2000, section 124D.86, 
        subdivision 3, is amended to read: 
           Subd. 3.  [INTEGRATION REVENUE.] For fiscal year 2000 and 
        later fiscal years, Integration revenue equals the following 
        amounts: 
           (1) for independent school district No. 709, Duluth, $207 
        times the adjusted pupil units for the school year; 
           (2) for independent school district No. 625, St. Paul, $446 
        times the adjusted pupil units for the school year; 
           (3) and for special school district No. 1, Minneapolis, 
        $536 $446 times the adjusted pupil units for the school year; 
        and 
           (3) for a district not listed in clause (1) or (2) that 
        must implement a plan under Minnesota Rules, parts 3535.0100 to 
        3535.0180, where the district's enrollment of protected 
        students, as defined under Minnesota Rules, part 3535.0110, 
        exceeds 15 percent, the lesser of (i) the actual cost of 
        implementing the plan during the fiscal year minus the aid 
        received under subdivision 6, or (ii) $130 times the adjusted 
        pupil units for the school year; 
           (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 3535.0100 to 3535.0180, 
        the lesser of 
           (i) the actual cost of implementing the plan during the 
        fiscal year minus the aid received under subdivision 6, or 
           (ii) $93 times the adjusted pupil units for the school year.
           Any money received by districts in clauses (1) to (3) which 
        exceeds the amount received in fiscal year 2000 shall be subject 
        to the budget requirements in subdivision 1a.; and 
           (5) for a member district of a multidistrict integration 
        collaborative that files a plan with the commissioner, but is 
        not contiguous to a racially isolated district, integration 
        revenue equals the amount defined in clause (4). 
           [EFFECTIVE DATE.] The changes in clause (2) of this section 
        are effective for aid for fiscal year 2003 and for levy for 
        taxes payable in 2002 and later.  The changes in clauses (3) and 
        (5) are effective for revenue for fiscal year 2002 and later. 
           Sec. 48.  Minnesota Statutes 2000, section 124D.59, 
        subdivision 2, is amended to read: 
           Subd. 2.  [PUPIL OF LIMITED ENGLISH PROFICIENCY.] "Pupil of 
        limited English proficiency" means a pupil in any of the grades 
        of kindergarten through 12 who meets the following requirements: 
           (1) the pupil in kindergarten through grade 12, as declared 
        by a parent or guardian first learned a language other than 
        English, comes from a home where the language usually spoken is 
        other than English, or usually speaks a language other than 
        English; and 
           (2) the pupil's score is significantly below the average 
        district score for pupils of the same age on a nationally normed 
        English reading or English language arts achievement test.  A 
        pupil's score shall be considered significantly below the 
        average district score for pupils of the same age if it is 
        one-third of a standard deviation below that average score for a 
        pupil in kindergarten through grade 2, the pupil is determined 
        by developmentally appropriate measures, which might include 
        observations, teacher judgment, parent recommendations, or 
        developmentally appropriate assessment instruments, to lack the 
        necessary English skills to participate fully in classes taught 
        in English; or 
           (3) the pupil in grades 3 through 12 scores below the state 
        cutoff score on an assessment measuring emerging academic 
        English provided by the commissioner. 
           [EFFECTIVE DATE.] This section is effective for the 
        2002-2003 school year and later. 
           Sec. 49.  Minnesota Statutes 2000, section 124D.84, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AWARDS.] The commissioner, with the advice 
        and counsel of the Minnesota Indian scholarship education 
        committee, may award scholarships to any Minnesota resident 
        student who is of one-fourth or more Indian ancestry, who has 
        applied for other existing state and federal scholarship and 
        grant programs, and who, in the opinion of the commissioner, has 
        the capabilities to benefit from further education.  
        Scholarships must be for accredited degree programs in 
        accredited Minnesota colleges or universities or for courses in 
        accredited Minnesota business, technical, or vocational 
        schools.  Scholarships may also be given to students attending 
        Minnesota colleges that are in candidacy status for obtaining 
        full accreditation, and are eligible for and receiving federal 
        financial aid programs.  Students are also eligible for 
        scholarships when enrolled as students in Minnesota higher 
        education institutions that have joint programs with other 
        accredited higher education institutions.  Scholarships shall be 
        used to defray the total cost of education including tuition, 
        incidental fees, books, supplies, transportation, other related 
        school costs and the cost of board and room and shall be paid 
        directly to the college or school concerned where the student 
        receives federal financial aid.  The total cost of education 
        includes all tuition and fees for each student enrolling in a 
        public institution and the portion of tuition and fees for each 
        student enrolling in a private institution that does not exceed 
        the tuition and fees at a comparable public institution.  Each 
        student shall be awarded a scholarship based on the total cost 
        of the student's education and a federal standardized need 
        analysis.  Applicants are encouraged to apply for all other 
        sources of financial aid.  The amount and type of each 
        scholarship shall be determined through the advice and counsel 
        of the Minnesota Indian scholarship education committee. 
           When an Indian student satisfactorily completes the work 
        required by a certain college or school in a school year the 
        student is eligible for additional scholarships, if additional 
        training is necessary to reach the student's educational and 
        vocational objective.  Scholarships may not be given to any 
        Indian student for more than five years of study without special 
        approval recommendation of the Minnesota Indian scholarship 
        education committee.  
           Sec. 50.  Minnesota Statutes 2000, section 124D.892, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [ESTABLISHMENT.] (a) An office of 
        desegregation/integration is established in the department of 
        children, families, and learning to coordinate and support 
        activities related to student enrollment, student and staff 
        recruitment and retention, transportation, and interdistrict 
        cooperation among metropolitan school districts.  
           (b) At the request of a metropolitan school district 
        involved in cooperative desegregation/integration efforts, the 
        office shall perform any of the following activities: 
           (1) assist districts with interdistrict student transfers, 
        including student recruitment, counseling, placement, and 
        transportation; 
           (2) coordinate and disseminate information about schools 
        and programs; 
           (3) assist districts with new magnet schools and programs; 
           (4) assist districts in providing staff development and 
        in-service training; and 
           (5) coordinate and administer staff exchanges. 
           (c) The office shall collect data on the efficacy of 
        districts' desegregation/integration efforts and make 
        recommendations based on the data.  The office shall 
        periodically consult with the metropolitan council to coordinate 
        metropolitan school desegregation/integration efforts with the 
        housing, social, economic, and infrastructure needs of the 
        metropolitan area.  The office shall develop a process for 
        resolving students' disputes and grievances about student 
        transfers under a desegregation/integration plan.  
           Sec. 51.  Minnesota Statutes 2000, section 124D.892, 
        subdivision 3, as amended by Laws 2001, chapter 7, section 32, 
        is amended to read: 
           Subd. 3.  [ADVISORY BOARD.] The commissioner shall 
        establish an advisory board composed of: 
           (1) nine superintendents, eight of whom are selected by the 
        superintendents of the school districts located in whole or in 
        part within each of the eight metropolitan districts established 
        under section 473.123, subdivision 3c, and one who is from a 
        district outside the seven-county metropolitan area that is 
        considered racially isolated or that has a racially isolated 
        school site according to Minnesota Rules, part 3535.0110; 
           (2) one person each selected by the Indian affairs council, 
        the council on Asian-Pacific Minnesotans, the council on Black 
        Minnesotans, and the council on affairs of Chicano/Latino 
        people; and 
           (3) the superintendent of independent school district No. 
        709, Duluth. 
           The advisory board shall advise the office on complying 
        with the requirements under subdivision 1.  The advisory board 
        may solicit comments from teachers, parents, students, and 
        interested community organizations and others. 
           The advisory board shall expire June 30, 2003.  
           Sec. 52.  Minnesota Statutes 2000, section 124D.894, is 
        amended to read: 
           124D.894 [STATE MULTICULTURAL EDUCATION ADVISORY 
        COMMITTEE.] 
           (a) The commissioner shall appoint a state multicultural 
        education advisory committee to advise the department and the 
        state board on multicultural education.  The committee must have 
        12 members and be composed of representatives from among the 
        following groups and community organizations:  African-American, 
        Asian-Pacific, Hispanic, and American Indian.  The committee 
        shall expire June 30, 2003.  
           (b) The state committee shall provide information and 
        recommendations on: 
           (1) department procedures for reviewing and approving 
        district plans and disseminating information on multicultural 
        education; 
           (2) department procedures for improving inclusive education 
        plans, curriculum and instruction improvement plans, and 
        performance-based assessments; 
           (3) developing learner outcomes which are multicultural; 
        and 
           (4) other recommendations that will further inclusive, 
        multicultural education. 
           (c) The committee shall also participate in determining the 
        criteria for and awarding the grants established under Laws 
        1993, chapter 224, article 8, section 22, subdivision 8. 
           Sec. 53.  [124D.945] [EDUCATIONAL IMPROVEMENT PLAN.] 
           Subdivision 1.  [QUALIFYING PLAN.] A district may develop 
        an educational improvement plan for the purpose of qualifying 
        for alternative teacher compensation aid under sections 124D.946 
        and 124D.947.  The plan must include measures for improving 
        school district, school site, teacher, and individual student 
        performance.  
           Subd. 2.  [PLAN COMPONENTS.] The educational improvement 
        plan must be approved by the school board and have at least 
        these elements: 
           (1) assessment and evaluation tools to measure student 
        performance and progress; 
           (2) performance goals and benchmarks for improvement; 
           (3) measures of student attendance and completion rates; 
           (4) a rigorous professional development system that is 
        aligned with educational improvement, designed to achieve 
        teaching quality improvement, and consistent with clearly 
        defined research-based standards; 
           (5) measures of student, family, and community involvement 
        and satisfaction; 
           (6) a data system about students and their academic 
        progress that provides parents and the public with 
        understandable information; and 
           (7) a teacher induction and mentoring program for 
        probationary teachers that provides continuous learning and 
        sustained teacher support.  The process for developing the plan 
        must involve district teachers. 
           Subd. 3.  [SCHOOL SITE ACCOUNTABILITY.] A district that 
        develops a plan under subdivisions 1 and 2 must ensure that each 
        school site develops a board-approved educational improvement 
        plan that is aligned with the district educational improvement 
        plan under subdivision 2.  While a site plan must be consistent 
        with the district educational improvement plan, it may establish 
        performance goals and benchmarks that meet or exceed those of 
        the district.  The process for developing the plan must involve 
        site teachers.  
           Sec. 54.  [124D.946] [ALTERNATIVE TEACHER COMPENSATION.] 
           Subdivision 1.  [RESTRUCTURED PAY SYSTEM.] A restructured 
        teacher compensation system is established under subdivision 2 
        to provide incentives for teachers to improve their knowledge 
        and skills and for school districts to recruit and retain highly 
        qualified teachers, and to support teachers' roles in improving 
        students' educational achievement.  
           Subd. 2.  [ALTERNATIVE TEACHER PROFESSIONAL PAY 
        SYSTEM.] (a) To participate in this program, a school district 
        must have an educational improvement plan as described in 
        section 124D.945 and an alternative teacher professional pay 
        system as described in paragraph (b). 
           (b) The alternative teacher professional pay system must: 
           (1) describe the conditions necessary for career 
        advancement and additional compensation; 
           (2) provide career advancement options for teachers 
        retaining primary roles in student instruction; 
           (3) use a professional pay system that replaces the step 
        and lane salary schedule and is not based on years of service; 
           (4) encourage teachers' continuous improvement in content 
        knowledge, pedagogy, and use of best practices; and 
           (5) implement an objective evaluation system, including 
        classroom observation, that is aligned with the district's or 
        the site's educational improvement plan as described in section 
        124D.945. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 55.  [124D.947] [ALTERNATIVE COMPENSATION AID.] 
           Subdivision 1.  [AID AMOUNT.] (a) A school district that 
        meets the conditions of section 124D.946 and submits an 
        application approved by the commissioner is eligible for 
        alternative compensation aid.  The commissioner must consider 
        only applications submitted jointly by a school district and the 
        exclusive representative of the teachers for participation in 
        the program.  The application must contain a formally adopted 
        collective bargaining agreement, memorandum of understanding, or 
        other binding agreement that implements an alternative teacher 
        professional pay system consistent with section 124D.946 and 
        includes all teachers in a district, all teachers at a school 
        site, or at least 25 percent of the teachers in a district.  The 
        commissioner may give preference to applications involving 
        entire districts or sites in approving applications.  
           (b) Alternative compensation aid for a qualifying school 
        district, site, or portion of a district or school site is as 
        follows: 
           (1) for a school district in which the school board and the 
        exclusive representative of the teachers agree to place all 
        teachers in the district or at the site on the alternative 
        compensation schedule, alternative compensation aid equals $150 
        times the district's or the site's number of pupils enrolled on 
        October 1 of the previous fiscal year; or 
           (2) for a district in which the school board and the 
        exclusive representative of the teachers agree that at least 25 
        percent of the district's licensed teachers will be paid on the 
        alternative compensation schedule, alternative compensation aid 
        equals $150 times the percentage of participating teachers times 
        the district's number of pupils enrolled as of October 1 of the 
        previous fiscal year.  
           Subd. 2.  [PERCENTAGE OF TEACHERS.] For purposes of this 
        section, the percentage of teachers participating in the teacher 
        professional pay system equals the ratio of the number of 
        licensed teachers who are working at least 60 percent of a 
        full-time teacher's hours and agree to participate in the 
        teacher professional pay system to the total number of licensed 
        teachers who are working at least 60 percent of a full-time 
        teacher's hours.  
           Subd. 3.  [AID TIMING.] (a) Districts or sites with 
        approved applications must receive alternative compensation aid 
        for each school year that the district or site participates in 
        the program.  The commissioner must approve initial applications 
        for school districts qualifying under subdivision 1, paragraph 
        (b), clause (1), by January 15 of each year.  If any money 
        remains, the commissioner must approve aid amounts for school 
        districts qualifying under subdivision 1, paragraph (b), clause 
        (2), by February 15 of each year.  
           (b) The commissioner shall select applicants that qualify 
        for this program, notify school districts and school sites about 
        the program, develop and disseminate application materials, and 
        carry out other activities needed to implement this section.  
           [EFFECTIVE DATE.] This section is effective July 1, 2001. 
           Sec. 56.  Minnesota Statutes 2000, section 126C.05, 
        subdivision 15, is amended to read: 
           Subd. 15.  [LEARNING YEAR PUPIL UNITS.] (a) When a pupil is 
        enrolled in a learning year program under section 124D.128, an 
        area learning center under sections 123A.05 and 123A.06, an 
        alternative program approved by the commissioner, or a contract 
        alternative program under section 124D.68, subdivision 3, 
        paragraph (d), or subdivision 3a, for more than 1,020 hours in a 
        school year for a secondary student, more than 935 hours in a 
        school year for an elementary student, 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; (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 district must meet the requirements in this paragraph.  The 
        district must develop, with for 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 consistent with section 124D.128, 
        subdivision 3.  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 126C.15, subdivision 2. 
           (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.  The district must develop a continual 
        learning plan for the pupil, consistent with section 124D.128, 
        subdivision 3.  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 126C.15, subdivision 2.  
           (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. 57.  Minnesota Statutes 2000, section 126C.05, is 
        amended by adding a subdivision to read: 
           Subd. 18.  [PUPIL ADJUSTMENT FOR CLOSED CHARTER SCHOOLS AND 
        CONTRACTED ALTERNATIVE PROGRAMS.] For a charter school or 
        contracted alternative program operating during the prior school 
        year but ceasing operations before the end of the current school 
        year, prior year pupil data used in computing revenues for the 
        current school year shall be prorated based on the number of 
        days of student instruction in the current school year to 170. 
           Sec. 58.  Minnesota Statutes 2000, section 127A.45, 
        subdivision 9, is amended to read: 
           Subd. 9.  [FINAL ADJUSTMENT PAYMENT.] (a) For all aids and 
        credits paid according to subdivision 13, the final adjustment 
        payment must include the amounts necessary to pay the district's 
        full aid entitlement for the prior year based on actual data.  
        This payment must be used to correct all estimates used for the 
        payment schedule in subdivision 3.  The payment must be made as 
        specified in subdivision 3.  In the event actual data are not 
        available, the final adjustment payment may be computed based on 
        estimated data.  A corrected final adjustment payment must be 
        made when actual data are available.  
           (b) Notwithstanding paragraph (a) and subdivision 3, for a 
        charter school that ceases operation before the end of a school 
        year, a final adjustment payment for aid programs funded with an 
        open appropriation may be made after audit of the prior fiscal 
        year and current fiscal year pupil counts. 
           Sec. 59.  Minnesota Statutes 2000, 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 Perpich 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 must 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 must 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 
        310; 
           (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; 
           (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 Perpich 
        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 commissioner of 
        children, families, and learning.  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 
        123B.34 to 123B.39.  
           (o) The board may establish and set fees for services and 
        programs.  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 123B.38.  
           (p) The board may apply for all competitive grants 
        administered by agencies of the state and other government or 
        nongovernment sources. 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and later. 
           Sec. 60.  Minnesota Statutes 2000, section 171.02, 
        subdivision 2a, as amended by Laws 2001, chapter 97, section 4, 
        is amended to read: 
           Subd. 2a.  [EXCEPTIONS.] (a) Notwithstanding subdivision 2, 
        (1) a hazardous materials endorsement is not required to operate 
        a vehicle having a gross vehicle weight of 26,000 pounds or less 
        while carrying in bulk tanks a total of not more than 200 
        gallons of petroleum products and (2) a class C license or 
        hazardous materials endorsement is not required to operate a 
        farm vehicle as defined in Code of Federal Regulations, title 
        49, section 390.5, having a gross vehicle weight of 26,000 
        pounds or less while carrying in bulk tanks a total of not more 
        than 1,500 gallons of liquid fertilizer. 
           (b) Notwithstanding subdivision 2, paragraph (c), the 
        holder of a class D driver's license, without a school bus 
        endorsement, may operate a type A school bus described in 
        subdivision 2, paragraph (b), under the following conditions: 
           (1) The operator is an employee as of the day following 
        final enactment of this act of the entity that owns, leases, or 
        contracts for the school bus and is not solely hired to provide 
        transportation services under this paragraph. 
           (2) The operator drives the school bus only from points of 
        origin to points of destination, not including home-to-school 
        trips to pick up or drop off students.  
           (3) The operator is prohibited from using the eight-light 
        system.  Violation of this clause is a misdemeanor. 
           (4) The operator's employer has adopted and implemented a 
        policy that provides for annual training and certification of 
        the operator in: 
           (i) safe operation of the type of school bus the operator 
        will be driving; 
           (ii) understanding student behavior, including issues 
        relating to students with disabilities; 
           (iii) encouraging orderly conduct of students on the bus 
        and handling incidents of misconduct appropriately; 
           (iv) knowing and understanding relevant laws, rules of the 
        road, and local school bus safety policies; 
           (v) handling emergency situations; and 
           (vi) safe loading and unloading of students. 
           (5) A background check or background investigation of the 
        operator has been conducted that meets the requirements under 
        section 122A.18, subdivision 8, or 123B.03 for teachers; section 
        144.057 or 245A.04 for day care employees; or section 171.321, 
        subdivision 3, for all other persons operating a type A school 
        bus under this paragraph. 
           (6) Operators shall submit to a physical examination as 
        required by section 171.321, subdivision 2. 
           (7) The operator's driver's license is verified annually by 
        the entity that owns, leases, or contracts for the school bus. 
           (8) A person who sustains a conviction, as defined under 
        section 609.02, of violating section 169A.25, 169A.26, 169A.27, 
        169A.31, 169A.51, or 169A.52, or a similar statute or ordinance 
        of another state is precluded from operating a school bus for 
        five years from the date of conviction. 
           (9) A person who sustains a conviction, as defined under 
        section 609.02, of a fourth moving offense in violation of 
        chapter 169 is precluded from operating a school bus for one 
        year from the date of the last conviction. 
           (10) Students riding the school bus must have training 
        required under section 123B.90, subdivision 2. 
           (11) An operator must be trained in the proper use of child 
        safety restraints as set forth in the National Highway Traffic 
        Safety Administration's "Guideline for the Safe Transportation 
        of Pre-school Age Children in School Buses." 
           (12) Annual certification of the requirements listed in 
        this paragraph must be maintained under separate file at the 
        business location for each operator licensed under this 
        paragraph and subdivision 2, paragraph (b), clause (5).  The 
        business manager, school board, governing body of a nonpublic 
        school, or any other entity that owns, leases, or contracts for 
        the school bus operating under this paragraph is responsible for 
        maintaining these files for inspection. 
           (13) The school bus must bear a current certificate of 
        inspection issued under section 169.451. 
           (14) The word "School" on the front and rear of the bus 
        must be covered by a sign that reads "Activities" when the bus 
        is being operated under authority of this paragraph. 
           Sec. 61.  Minnesota Statutes 2000, section 179A.20, is 
        amended by adding a subdivision to read: 
           Subd. 2b.  [STRUCTURALLY BALANCED SCHOOL DISTRICT 
        BUDGETS.] (a) Prior to approving a collective bargaining 
        agreement that does not result from an interest arbitration 
        decision, a school board must determine by board resolution that 
        the proposed agreement will not cause structural imbalance in 
        the district's budget during the period of the agreement. 
           (b)  A school board may only determine that an agreement 
        will not cause structural imbalance if expenditures will not 
        exceed available funds, taking into account: 
           (1) current state aid formulas; and 
           (2) reasonable and comprehensive projections of ongoing 
        revenues and expenditures for the period of the agreement.  It 
        is expected that one-time revenue may not be used for ongoing 
        expenditures.  The school board must make available with the 
        resolution a summary of the projections and calculations 
        supporting the determination.  The projections and calculations 
        must include state aid formulas, pupil units, and employee 
        costs, including the terms of labor agreements, including the 
        agreement under consideration, fringe benefits, severance pay, 
        and staff changes. 
           (c) In addition to the determination required in paragraph 
        (a), the school board must project revenues, expenditures, and 
        fund balances for one year following the period of the 
        agreement.  The projections must include the categories of 
        information described in paragraph (b), be reasonable and 
        comprehensive, and reference current state aid formulas.  
           (d) All projections and calculations required by this 
        section must be made available to the public prior to and at the 
        meeting where the resolution is adopted in a manner consistent 
        with state law on public notice and access to public data.  
           (e) In an interest arbitration, the district must submit, 
        and the exclusive bargaining representative may submit, proposed 
        determinations with supporting projections and calculations 
        consistent with paragraph (b) of the effect of the potential 
        decision on the structural balance of the district's budget.  
        The arbitrator must consider the potential effect of a decision 
        on the structural balance of the district's budget for the term 
        of the agreement.  The arbitrator's decision must describe the 
        effect of the decision on the structural balance of the 
        district's budget in a manner consistent with paragraph (b).  
        The arbitrator's decision must also show the effect of the 
        decision on the school budget for one year following the term of 
        the contract at issue.  Within 30 days of receipt of the 
        decision or when the board acts on the decision, whichever is 
        earlier, the school board must by resolution determine the 
        effect of the decision on the structural balance of its budget 
        for the term of the agreement consistent with paragraph (b). 
           (f) A copy of the resolution with the supporting 
        projections and calculations must be submitted to the 
        commissioner of children, families, and learning with the 
        uniform collective bargaining agreement settlement document 
        within 30 days of adoption of the resolution.  The commissioner 
        must develop a model form for use by districts in reporting 
        projections and calculations.  The commissioner must make all 
        resolutions, projections, and calculations available to the 
        public. 
           (g) Compliance with this section by itself is not an unfair 
        labor practice under section 179A.13, subdivision 2. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment and applies to contracts between 
        school boards and exclusive representatives of teachers for the 
        time period July 1, 2001, to June 30, 2003, and thereafter.  
        This section does not apply to contracts settled prior to the 
        effective date. 
           Sec. 62.  [LABORATORY SCHOOL; INNOVATIVE TEACHING 
        TECHNIQUES.] 
           Subdivision 1.  [PURPOSE.] The purpose of this section is 
        to ensure that the school children in kindergarten through grade 
        5 in the Randall area, elsewhere in the Little Falls school 
        district, and in all school districts in the state have access 
        to a high quality, innovative education experience. 
           Subd. 2.  [JOINT OFFICE ESTABLISHED.] Independent school 
        district No. 482, Little Falls; the department of children, 
        families, and learning; Minnesota state colleges and 
        universities; and St. Cloud State University's school of 
        education shall collaborate for the purpose of establishing a 
        joint office, if funds are available, to evaluate curriculum, 
        instruction, and testing.  The office shall be located at the 
        Dr. S. G. Knight school in Randall.  
           Subd. 3.  [LABORATORY SCHOOL.] The office under authority 
        of independent school district No. 482, Little Falls shall, if 
        funds are available, operate a laboratory school program for 
        elementary students in kindergarten through grade 5 at the Dr. 
        S. G. Knight school.  The laboratory school, if established, 
        must be used to develop innovative teaching techniques that 
        enhance students' learning experiences.  The office, if 
        established, must make the innovative teaching techniques, which 
        must include testing of students' knowledge, developed at the 
        laboratory school available to all school districts in the state.
           [EFFECTIVE DATE.] This section is effective July 1, 2001. 
           Sec. 63.  [ALTERNATIVE MODELS FOR DELIVERING EDUCATION; 
        EXPANDING THE FLEXIBLE LEARNING YEAR PROGRAM.] 
           Subdivision 1.  [ESTABLISHMENT; GOAL.] A three-year pilot 
        project is established to permit participating school districts 
        and school sites approved by the commissioner of children, 
        families, and learning under subdivision 2 to use alternative 
        models for delivering education by expanding the flexible 
        learning year program under Minnesota Statutes, sections 124D.12 
        to 124D.127.  The project is intended to explore effective 
        alternatives for delivering education, with the goal of 
        improving instruction and students' educational outcomes and 
        opportunities and increasing the cost-effectiveness of 
        educational programs. 
           Subd. 2.  [ELIGIBILITY; APPLICATIONS.] The commissioner 
        shall make application forms available to school districts and 
        school sites interested in exploring effective alternative 
        models for delivering instruction during a redefined flexible 
        learning year as described in this section.  Interested school 
        districts and school sites must have their application to 
        participate in this program first approved by the local school 
        board and a majority of teachers employed in the district or at 
        the site, respectively, after a public hearing on the matter.  
        Applications must be submitted to the commissioner by January 1, 
        2002.  The application must describe how the applicant proposes 
        to realize the goal of this project, including what activities 
        and procedures the applicant proposes to develop and implement 
        and the specific changes in the learning year the applicant 
        requires to accomplish those activities and procedures.  The 
        commissioner, consistent with the requirements of this section, 
        shall approve applications before March 1, 2002. 
           Subd. 3.  [EXEMPTIONS.] (a) Notwithstanding other laws or 
        rules to the contrary, a participant in the pilot project under 
        this section is exempt from Minnesota Statutes, sections 120A.40 
        and 120A.41, through the 2004-2005 school year.  Minnesota 
        Statutes, sections 124D.12 to 124D.127, apply through the 
        2004-2005 school year except to the extent that the provisions 
        of this section or the participant's learning year changes 
        conflict with particular provisions in Minnesota Statutes, 
        sections 124D.12 to 124D.127. 
           (b) Consistent with this section, a participant may adopt a 
        learning year calendar that allows the participant to suitably 
        fulfill the educational needs of its students using an 
        alternative learning year calendar.  The commissioner must 
        provide participants with a formula for computing average daily 
        membership so that all formulas based upon average daily 
        membership are not affected as a result of participating in this 
        pilot project. 
           Subd. 4.  [TECHNICAL ASSISTANCE.] The commissioner, at the 
        request of a participant, must provide technical assistance to 
        the participant.  Also, the commissioner must assist 
        participants in developing and implementing a valid and uniform 
        procedure to evaluate the efficacy of their alternative learning 
        year calendar, consistent with the goals of this section. 
           Subd. 5.  [EVALUATION; REPORT.] (a) Participants must 
        complete a formative and summative evaluation of their 
        experiences in delivering education under an alternative 
        learning year calendar.  Participants must focus the evaluation 
        on the overall efficacy of the pilot project, including the 
        cost-effectiveness of educational programs and the extent to 
        which students' educational outcomes and opportunities 
        improved.  Participants shall use their interim evaluations, 
        with the commissioner's approval, to modify their project where 
        appropriate. 
           (b) Participants shall submit to the commissioner a 
        progress report by September 1, 2004, and a final report by 
        January 1, 2006, evaluating the cost-effectiveness of 
        educational programs and the extent to which students' 
        educational outcomes and opportunities improved.  The 
        commissioner shall compile the reports to present to the 
        committees in the legislature that deal with education policy 
        and education finance by March 1, 2006.  When presenting the 
        report, the commissioner must recommend whether or not to 
        continue or expand this pilot project. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 64.  [SCHOOLS' ACADEMIC AND FINANCIAL PERFORMANCE 
        EVALUATION; INDEPENDENT CONTRACTOR.] 
           (a) To assist taxpayers, educators, school board members, 
        and state and local officials in realizing their commitment to 
        improving student achievement and the management of school 
        systems, the commissioner of children, families, and learning 
        shall contract with an independent school evaluation services 
        contractor to evaluate and report on the academic and financial 
        performance of the state's independent school districts using 
        six core categories of analysis: 
           (1) school district expenditures; 
           (2) students' performance outcomes based on multiple 
        indicia including students' test scores, attendance rates, 
        dropout rates, and graduation rates; 
           (3) return on resources to determine the extent to which 
        student outcomes improve commensurate with increases in district 
        spending; 
           (4) school district finances, taxes, and debt to establish 
        the context for analyzing the district's return on resources 
        under clause (3); 
           (5) students' learning environment to establish the context 
        for analyzing the district's return on resources under clause 
        (3); and 
           (6) school district demographics to establish the 
        socioeconomic context for analyzing the district's return on 
        resources under clause (3). 
           (b) In order to compare the regional and socioeconomic 
        peers of particular school districts, monitor educational 
        changes over time and identify important educational trends, the 
        contractor shall use the six core categories of analysis to: 
           (1) identify allocations of baseline and incremental school 
        district spending; 
           (2) connect student achievement with expenditure patterns; 
           (3) track school district financial health; 
           (4) observe school district debt and capital spending 
        levels; and 
           (5) measure the return on a school district's educational 
        resources. 
           (c) The contractor under paragraph (a) shall evaluate and 
        report on the academic and financial performance of all school 
        districts. 
           (d) Consistent with paragraph (a), clause (2), the 
        evaluation and reporting of test scores must distinguish between:
           (1) performance-based assessments; and 
           (2) academic, objective knowledge-based tests. 
           (e) The contractor must complete its written report and 
        submit it to the commissioner within 360 days of the date on 
        which the contract is signed.  The commissioner immediately must 
        make the report available in a readily accessible format to 
        state and local elected officials, members of the public, 
        educators, parents, and other interested individuals.  The 
        commissioner, upon receiving an individual's request, also must 
        make available all draft reports prepared by the contractor, 
        consistent with Minnesota Statutes, chapter 13. 
           Sec. 65.  [EXCESSIVE CHARTER SCHOOL LEASE COSTS; RELATED 
        PARTIES.] 
           (a) This section applies only to charter school leases 
        entered into before July 1, 2001, that are between related 
        parties as defined in paragraph (c), clause (1). 
           (b) This section does not apply to a lease in which: 
           (1) the lessor and lessee are not related parties, as 
        defined in this section, as determined in writing by the 
        commissioner; or 
           (2) the lessor and lessee are related parties, but the 
        lessor is a nonprofit corporation under chapter 317A or a 
        cooperative under chapter 308A. 
           (c) For purposes of this section: 
           (1) "Related party" means an affiliate or close relative of 
        the other party in question, an affiliate of a close relative, 
        or a close relative of an affiliate.  
           (2) "Affiliate" means a person that directly, or indirectly 
        through one or more intermediaries, controls, or is controlled 
        by, or is under common control with, another person. 
           (3) "Close relative" means an individual whose relationship 
        by blood, marriage, or adoption to another individual is no more 
        remote than first cousin. 
           (4) "Person" means an individual or entity of any kind. 
           (5) "Control" includes the terms "controlling," "controlled 
        by," and "under common control with" and means the possession, 
        direct or indirect, of the power to direct or cause the 
        direction of the management, operations, or policies of a 
        person, whether through the ownership of voting securities, by 
        contract, or otherwise. 
           (d) To claim a lien under this section, the commissioner 
        must record with the county recorder or file with the registrar 
        of titles, whichever is appropriate, a document entitled "Notice 
        of Lien," stating that the commissioner of children, families, 
        and learning of the state of Minnesota claims a lien under this 
        section on the real property, including fixtures.  The notice of 
        lien must contain a legal description of the leased real 
        property, be signed and acknowledged by the commissioner, and 
        meet all other applicable requirements for recording or filing.  
           (e) A lien created under this section secures the rights of 
        the commissioner under paragraph (f). 
           (f) The commissioner may recover from the lessor the amount 
        of rent or other payments made under the lease, to the extent 
        that the rent or other payments exceed the fair market rental 
        value of the real property, as determined by the commissioner.  
        If the lessor is not the holder of fee title to the real 
        property, the commissioner's right of recovery extends to the 
        holder of fee title if the lessor and holder of fee title are 
        related parties as defined in this section. 
           (g) The lien created under this section is subordinate to 
        the interest of any mortgagee or other lienholder of the 
        property, under a mortgage or other lien recorded or filed prior 
        to the recording or filing of the lien created in this section, 
        except that this provision does not apply to a mortgagee or 
        other lienholder that is a related party to the lessor or other 
        party against whom the commissioner has a right of recovery 
        under paragraph (f).  The commissioner may agree to subordinate 
        the lien created under this paragraph to a prior or subsequent 
        mortgage or other lien if the commissioner determines that the 
        subordination is necessary to permit continued lawful operation 
        of the charter school.  The commissioner shall subordinate the 
        lien created under this section to a prior mortgage or other 
        lien if necessary to establish that the prior mortgagee or other 
        lienor is not a related party to the lessor or other party 
        against whom the commissioner has a right of recovery.  
           (h) The lien created in this section is not enforceable 
        against, and is subordinate to, the interest of a good faith 
        purchaser for value of the real property who (1) is not a 
        related party of the lessor or of another party against whom the 
        commissioner has a right of recovery under paragraph (f), and 
        (2) purchases the real property before the recording or filing 
        of the notice of lien. 
           (i) If, or to the extent that, the commissioner determines 
        that the commissioner has no right of recovery under a lien 
        created under this section, the commissioner shall provide to 
        the lessor, or other party having an interest in the property, a 
        release or partial release of this lien.  Any recording or 
        filing fees for the release are the responsibility of the person 
        requesting the release. 
           (j) A decision or action of the commissioner under this 
        subdivision may be appealed under chapter 14.  
           (k) A lien created under this section may be foreclosed in 
        the manner provided in chapter 581, with reasonable attorney 
        fees to be determined by the court. 
           (l) The commissioner must withhold the aid payments from a 
        charter school if, during the commissioner's annual review of 
        building lease agreements, the commissioner determines that the 
        charter school lease does not contain the notice of lien under 
        paragraph (d). 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 66.  [CHARTER SCHOOL ADVISORY COUNCIL; EXPIRATION.] 
           The charter school advisory council under Minnesota 
        Statutes, section 124D.10, subdivision 26, expires June 30, 2003.
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 67.  [TEST CONTENT.] 
           (a) The commissioner of the department of children, 
        families, and learning at least must include in the eighth grade 
        basic skills test in mathematics and in the mathematics portions 
        of the third, fifth, and seventh grade Minnesota comprehensive 
        assessments a sufficient number of test items to allow students 
        to demonstrate computational skills without using a calculator. 
           (b) The commissioner also must evaluate the impact of 
        including items from a variety of print sources in addition to 
        mass media, including fiction or nonfiction literature, in the 
        basic skills tests in reading. 
           [EFFECTIVE DATE.] The requirement in paragraph (a) to 
        include items to allow students to demonstrate computational 
        skills without using a calculator in the mathematics basic 
        skills test is effective February 1, 2002.  The requirement in 
        paragraph (a) to include items to allow students to demonstrate 
        computational skills without using a calculator in the Minnesota 
        comprehensive assessments is effective February 1, 2004.  
        Paragraph (b) is effective the day following final enactment. 
           Sec. 68.  [ACCESS TO TESTS.] 
           The commissioner of children, families, and learning must 
        adopt and publish a policy to provide public and parental access 
        for review of basic skills tests, Minnesota comprehensive 
        assessments, or any other such statewide test and assessment.  
        Upon receiving a written request, the commissioner must make 
        available to parents or guardians a copy of their student's 
        actual answer sheet to the test questions. 
           [EFFECTIVE DATE.] This section is effective February 1, 
        2002. 
           Sec. 69.  [PROCESS TO ALLOW STUDENTS TO TAKE THE BASIC 
        SKILLS TEST AS EARLY AS FIFTH GRADE.] 
           The commissioner of children, families, and learning shall 
        develop a process to allow students to take the test of basic 
        requirements in reading, math, or writing beginning in grade 5.  
        The recommended process must include the parental or guardian 
        consent, a recommendation from the student's teacher to take a 
        test, and a policy that would limit the number of students who 
        take the test to only those that are likely to pass the test.  
        The commissioner shall consider options of an alternative test 
        or other methods that would preserve the statistical integrity 
        of the current scoring and sampling methods.  The commissioner 
        shall report its recommendations to the education committees of 
        the legislature by February 1, 2002. 
           Sec. 70.  [READING COMPETENCY; ST. CROIX RIVER EDUCATION 
        DISTRICT.] 
           The St. Croix river education district must use its 
        expertise in early literacy and the teaching of reading, its 
        strategies for improving students' reading ability, its student 
        performance measures, and its accountability structure to 
        measure reading program results, to assist school sites and 
        charter schools, including sites where at least 25 percent of 
        K-3 students are eligible to receive a free or reduced price 
        lunch, in achieving children's reading competency by the end of 
        third grade. The St. Croix river education district also must 
        work with preschool program staff to develop reading-related 
        skills that are research-based predictors of literacy. 
           Sec. 71.  [NO DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING AUDIT PENALTY.] 
           Notwithstanding other law or rule to the contrary, the 
        commissioner of children, families, and learning is prohibited 
        from imposing any penalty, including a financial penalty, on 
        independent school district No. 138, North Branch, as a result 
        of findings 7, 8, and 11, contained in a department of children, 
        families, and learning 1998-1999 fiscal year audit of pupil unit 
        counts related to the district's learning year program under 
        Minnesota Statutes, section 124D.128. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 72.  [DEADLINE AND PENALTY WAIVED.] 
           The deadline and penalty under Minnesota Statutes, section 
        123B.05, subdivision 2, do not apply for aid payments for the 
        2002-2003 biennium. 
           Sec. 73.  [PARTICIPATION IN ATHLETIC ACTIVITIES; MINNESOTA 
        STATE HIGH SCHOOL LEAGUE STUDY.] 
           The Minnesota state high school league must prepare a 
        written report by February 15, 2002, for the legislative 
        committees charged with overseeing kindergarten through grade 12 
        education policy that indicates the interest of charter school 
        students in participating in athletic activities available in 
        the students' resident district.  The Minnesota state high 
        school league at least must: 
           (1) survey the students enrolled in the state's charter 
        schools to determine how interested the students are in 
        participating in various athletic activities offered by their 
        resident school district; 
           (2) review the ability of charter schools to independently 
        or through a cooperative sponsorship provide students with 
        various athletic activities; and 
           (3) determine whether the league's cooperative sponsorship 
        rules need to be amended to facilitate cooperative sponsorship 
        arrangements involving charter schools.  The Minnesota state 
        high school league must cover the costs of this report. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 74.  [SCIENCE LICENSURE.] 
           The board of teaching must issue a teaching license to an 
        applicant who qualifies to teach general science to students in 
        grades five to eight, or who qualifies to teach a specialty in 
        physics, chemistry, life science, or earth and space science to 
        students in grades nine to 12 if the applicant meets other 
        applicable licensure requirements, including the requirements of 
        Minnesota Statutes, section 122A.18, subdivision 8. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 75.  [CAREER AND TECHNICAL LEVY.] 
           For taxes payable in 2002 only, a district that received 
        revenue during fiscal year 2001 under Minnesota Statutes, 
        section 124D.453, may levy an amount equal to the district's 
        fiscal year 2001 entitlement for career and technical aid under 
        Minnesota Statutes, section 124D.453, or $7,500, whichever is 
        greater.  The district may recognize the full amount of this 
        levy as revenue for fiscal year 2002. 
           Sec. 76.  [INTEGRATION LEVY.] 
           For taxes payable in 2002 only, a district's integration 
        levy under Minnesota Statutes, section 124D.86, subdivision 4, 
        equals 37 percent of the district's integration revenue as 
        defined in Minnesota Statutes, section 124D.86, subdivision 3.  
        For fiscal year 2003 only, a district's integration aid under 
        Minnesota Statutes, section 124D.86, subdivision 5, equals 63 
        percent of the district's integration revenue as defined in 
        Minnesota Statutes, section 124D.86, subdivision 3. 
           Sec. 77.  [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 indicated.  
           Subd. 2.  [EXAMINATION FEES; TEACHER TRAINING AND SUPPORT 
        PROGRAMS.] (a) For students' advanced placement and 
        international baccalaureate examination fees under Minnesota 
        Statutes 2000, section 120B.13, subdivision 3, and the training 
        and related costs for teachers and other interested educators 
        under Minnesota Statutes 2000, section 120B.13, subdivision 1: 
             $2,000,000     .....     2002 
             $2,000,000     .....     2003 
           Any funds unexpended in the first year do not cancel and 
        are available in the second year. 
           (b) The advanced placement program shall receive 75 percent 
        of the appropriation each year and the international 
        baccalaureate program shall receive 25 percent of the 
        appropriation each year.  The department, in consultation with 
        representatives of the advanced placement and international 
        baccalaureate programs selected by the advanced placement 
        advisory council and IBMN, respectively, shall determine the 
        amounts of the expenditures each year for examination fees and 
        training and support programs for each program. 
           (c) Notwithstanding Minnesota Statutes, section 120B.13, 
        subdivision 1, $375,000 each year is for teachers to attend 
        subject matter summer training programs and follow-up support 
        workshops approved by the advanced placement or international 
        baccalaureate programs.  The amount of the subsidy for each 
        teacher attending an advanced placement or international 
        baccalaureate summer training program or workshop shall be the 
        same.  The commissioner shall determine the payment process and 
        the amount of the subsidy. 
           (d) Notwithstanding Minnesota Statutes, section 120B.13, 
        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. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 3.  [STATEWIDE TESTING.] For administering tests 
        under Minnesota Statutes, sections 120B.02; 120B.30, subdivision 
        1; and 120B.35: 
             $6,500,000     .....     2002 
             $6,500,000     .....     2003 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 4.  [CHARTER SCHOOL BUILDING LEASE AID.] For building 
        lease aid under Minnesota Statutes, section 124D.11, subdivision 
        4: 
             $16,554,000    .....     2002 
             $25,176,000    .....     2003 
           The 2002 appropriation includes $1,114,000 for 2001 and 
        $15,440,000 for 2002. 
           The 2003 appropriation includes $1,715,000 for 2002 and 
        $23,461,000 for 2003.  
           Subd. 5.  [CHARTER SCHOOL STARTUP GRANTS.] For charter 
        school startup cost aid under Minnesota Statutes, section 
        124D.11: 
             $2,738,000     .....     2002 
             $3,143,000     .....     2003 
           The 2002 appropriation includes $273,000 for 2001 and 
        $2,465,000 for 2002.  
           The 2003 appropriation includes $274,000 for 2002 and 
        $2,869,000 for 2003. 
           Subd. 6.  [CHARTER SCHOOL INTEGRATION AID.] For grants to 
        charter schools to promote integration and desegregation under 
        Minnesota Statutes, section 124D.11, subdivision 6, paragraph 
        (e): 
             $45,000        .....     2002 
             $50,000        .....     2003 
           The 2002 appropriation includes $0 for 2001 and $45,000 for 
        2002.  
           The 2003 appropriation includes $5,000 for 2002 and $45,000 
        for 2003. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 7.  [BEST PRACTICES SEMINARS.] For best practices 
        graduation rule seminars and other professional development 
        capacity building activities that assure proficiency in teaching 
        and implementation of graduation rule standards: 
             $5,260,000     .....     2002
             $3,480,000     .....     2003
           $1,000,000 in fiscal year 2002 is for arts via the Internet 
        collaborative project between the Walker Art Center and the 
        Minneapolis Institute of Arts; $500,000 each year is for best 
        practices grants to intermediate school districts Nos. 287, 916, 
        and 917 to train teachers of special needs students under Laws 
        1998, chapter 398, article 5, section 42; and $250,000 each year 
        is for a grant to A Chance to Grow/New Visions for the Minnesota 
        Learning Resource Center.  
           The commissioner shall consider a curriculum development 
        grant, consistent with the graduation rule, to develop curricula 
        in the area of natural sciences including botany, horticulture, 
        and zoology.  The grant shall also be used to provide 
        instructional materials on the Internet.  The commissioner shall 
        consider best practices grants to districts for developing 
        gifted and talented services that are integrated with the 
        state's graduation standards.  The commissioner shall consider a 
        grant to independent school district No. 621, Mounds View, for a 
        pilot project to establish a parallel block schedule strategy in 
        grades 1 through 3. 
           Subd. 8.  [INTEGRATION AID.] For integration aid: 
             $65,478,000    .....     2002 
             $51,996,000    .....     2003 
           The 2002 appropriation includes $5,729,000 for 2001 and 
        $59,749,000 for 2002. 
           The 2003 appropriation includes $6,639,000 for 2002 and 
        $45,357,000 for 2003.  
           Subd. 9.  [INTEGRATION PROGRAMS.] For minority fellowship 
        grants under Laws 1994, chapter 647, article 8, section 29; 
        minority teacher incentives under Minnesota Statutes, section 
        122A.65; teachers of color program grants under Minnesota 
        Statutes, section 122A.64; and cultural exchange grants under 
        Minnesota Statutes, section 124D.89: 
             $1,000,000     .....     2002
             $1,000,000     .....     2003
           In awarding teachers of color program grants, the 
        commissioner must give priority to districts that have students 
        who are in the process of currently completing their academic 
        program. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 10.  [MAGNET SCHOOL GRANTS.] For magnet school and 
        program grants under Minnesota Statutes, section 124D.871: 
             $750,000       .....     2002 
             $750,000       .....     2003 
           $100,000 in fiscal year 2002 is to extend the Ely magnet 
        school grant approved under Laws 2000, chapter 489, article 7, 
        section 15, subdivision 5. 
           Subd. 11.  [MAGNET SCHOOL STARTUP AID.] For magnet school 
        startup aid under Minnesota Statutes, section 124D.88: 
             $482,000       .....     2002 
             $326,000       .....     2003 
           The 2002 appropriation includes $25,000 for 2001 and 
        $457,000 for 2002.  
           The 2003 appropriation includes $51,000 for 2002 and 
        $275,000 for 2003. 
           Subd. 12.  [INTERDISTRICT DESEGREGATION OR INTEGRATION 
        TRANSPORTATION GRANTS.] For interdistrict desegregation or 
        integration transportation grants under Minnesota Statutes, 
        section 124D.87: 
             $2,932,000     .....     2003
           Subd. 13.  [AMERICAN INDIAN LANGUAGE AND CULTURE PROGRAMS.] 
        For grants to American Indian language and culture education 
        programs under Minnesota Statutes 2000, section 124D.81, 
        subdivision 1: 
             $73,000        .....     2002
           The 2002 appropriation includes $73,000 for 2001 and $0 for 
        2002. 
           Subd. 14.  [AMERICAN INDIAN EDUCATION.] For certain 
        American Indian education programs in school districts: 
             $17,000        .....     2002
           The 2002 appropriation includes $17,000 for 2001 and $0 for 
        2002. 
           Subd. 15.  [SUCCESS FOR THE FUTURE.] For American Indian 
        success for the future grants according to Minnesota Statutes, 
        section 124D.81: 
             $2,047,000     .....     2002
             $2,137,000     .....     2003
           The 2002 appropriation includes $0 for 2001 and $2,047,000 
        for 2002. 
           The 2003 appropriation includes $255,000 for 2002 and 
        $2,132,000 for 2003. 
           Subd. 16.  [AMERICAN INDIAN SCHOLARSHIPS.] For American 
        Indian scholarships under Minnesota Statutes, section 124D.84: 
             $1,875,000     .....     2002 
             $1,875,000     .....     2003 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 17.  [AMERICAN INDIAN TEACHER PREPARATION GRANTS.] (a)
        For joint grants to assist American Indian people to become 
        teachers under Minnesota Statutes, section 122A.63: 
             $190,000       .....     2002 
             $190,000       .....     2003 
           (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. 18.  [TRIBAL CONTRACT SCHOOLS.] For tribal contract 
        school aid under Minnesota Statutes, section 124D.83: 
             $2,520,000     .....     2002
             $2,767,000     .....     2003
           The 2002 appropriation includes $192,000 for 2001 and 
        $2,328,000 for 2002. 
           The 2003 appropriation includes $258,000 for 2002 and 
        $2,509,000 for 2003. 
           Subd. 19.  [EARLY CHILDHOOD PROGRAMS AT TRIBAL 
        SCHOOLS.] For early childhood family education programs at 
        tribal contract schools: 
             $68,000        .....     2002 
             $68,000        .....     2003 
           Subd. 20.  [FIRST GRADE PREPAREDNESS.] For first grade 
        preparedness grants under Minnesota Statutes, section 124D.081: 
             $7,150,000     .....     2002 
             $7,250,000     .....     2003
           Subd. 21.  [SECONDARY VOCATIONAL EDUCATION AID.] For 
        secondary vocational education aid under Minnesota Statutes, 
        section 124D.453: 
             $1,242,000     .....     2002 
           The 2002 appropriation includes $1,242,000 for 2001 and $0 
        for 2002.  
           Subd. 22.  [YOUTHWORKS PROGRAM.] For youthworks programs 
        under Minnesota Statutes, sections 124D.37 to 124D.45: 
             $1,788,000     .....     2002 
             $1,788,000     .....     2003 
           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. 
           Up to $250,000 each year may be used for the jobs for 
        America graduates program. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 23.  [EDUCATION AND EMPLOYMENT TRANSITIONS PROGRAM 
        GRANTS.] For education and employment transitions programming 
        under Minnesota Statutes, section 124D.46: 
             $775,000       .....     2002 
             $775,000       .....     2003 
           $250,000 each year is for ISEEK. 
           $450,000 each year is for youth apprenticeship grants and 
        to conduct a high school follow-up survey to include first, 
        third, and sixth year graduates of Minnesota schools. 
           $75,000 each year is for grants to school districts for the 
        junior achievement program. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 24.  [LEARN AND EARN GRADUATION ACHIEVEMENT PROGRAM.] 
        For the learn and earn graduation achievement program according 
        to Minnesota Statutes, section 124D.32: 
             $725,000       .....     2002 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 25.  [SCHOOL EVALUATION SERVICES.] For contracting 
        with an independent school evaluation services contractor to 
        evaluate and report on school districts' academic and financial 
        performance under section 64:  
             $2,500,000     .....     2002 
           Subd. 26.  [MINNESOTA STUDENT ORGANIZATION FOUNDATION.] For 
        the Minnesota student organization foundation under Minnesota 
        Statutes, section 124D.34: 
               $625,000     .....     2002 
               $625,000     .....     2003 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 27.  [READING COMPETENCY GRANTS.] For reading 
        competency grants under Minnesota Statutes, section 120B.12: 
               $100,000     .....     2002 
               $100,000     .....     2003 
           The commissioner must award one grant to the St. Croix 
        river education district by July 1, 2001. 
           Subd. 28.  [LABORATORY SCHOOL; INNOVATIVE TEACHING 
        TECHNIQUES.] For a grant to independent school district No. 482, 
        Little Falls, for a laboratory school for innovative teaching 
        techniques in the Randall area: 
             $10,000        .....     2002 
           Subd. 29.  [ALTERNATIVE TEACHER COMPENSATION.] For 
        alternative teacher compensation established under Minnesota 
        Statutes, sections 124D.945 to 124D.947: 
             $4,000,000     .....     2002 
             $4,000,000     .....     2003 
           If the appropriations under this subdivision are 
        insufficient to fund all program participants, the participants 
        shall be prioritized by the commissioner by the date of receipt 
        of the application.  A participant may receive less than the 
        maximum per pupil amount available under Minnesota Statutes, 
        section 124D.945, subdivision 3. 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 30.  [COLLABORATIVE URBAN EDUCATOR RECRUITMENT AND 
        TRAINING PROGRAMS.] For grants to collaborative urban educator 
        recruitment and training programs: 
             $1,300,000     .....     2002
             $1,300,000     .....     2003
           $500,000 each year is for the Southeast Asian teacher 
        program at Concordia University, St. Paul; $400,000 each year is 
        for the collaborative urban educator program at the University 
        of St. Thomas; and $400,000 each year is for the center for 
        excellence in urban teaching at Hamline University.  Grant 
        recipients must collaborate with urban and nonurban school 
        districts. 
           Any balance in the first year does not cancel but is 
        available in the second year.  This appropriation is one-time 
        only. 
           Subd. 31.  [LIMITED ENGLISH PROFICIENCY STUDY.] For a study 
        of limited English proficiency programs: 
             $20,000     .....     2002 
           The department of children, families, and learning must 
        study current practices and program models as well as best 
        practice research into effective methodology for instructing 
        students with limited English proficiency so that they may 
        participate fully in English language classroom content and 
        develop appropriate assessments and instruments to determine the 
        effectiveness of programs for students with limited English 
        proficiency.  The instruments must address the effectiveness of 
        the curriculum being taught, the instruction being provided, the 
        professional development provided, the manner in which student 
        progress in acquiring English language proficiency is assessed, 
        as well as other factors pertinent to the instruction of 
        students with limited English proficiency.  The study shall 
        include best practice research-based methods of instructing 
        students who are not literate in their native language.  The 
        department shall make the results of the study as well as the 
        instruments available to teachers and other educators involved 
        in the design and implementation of programs for students with 
        limited English proficiency and promote the use of best 
        practices described in the study.  The department must submit 
        its report to the education committees of the legislature by 
        February 15, 2002.  This appropriation is one-time only. 
           Sec. 78.  [REPEALER.] 
           (a) Minnesota Statutes 2000, section 124D.85, is repealed. 
           (b) Minnesota Statutes 2000, section 124D.32, is repealed, 
        effective July 1, 2002. 
           (c) Minnesota Statutes 2000, sections 124D.128, subdivision 
        7, and 135A.081, are repealed effective the day following final 
        enactment. 
           (d) Minnesota Rules, part 3501.0280, subpart 3, is repealed.

                                   ARTICLE 3
                                SPECIAL PROGRAMS
           Section 1.  Minnesota Statutes 2000, section 121A.41, 
        subdivision 10, is amended to read: 
           Subd. 10.  [SUSPENSION.] "Suspension" means an action 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, except as provided in federal law for a 
        student with a disability.  Each suspension action may include a 
        readmission plan.  The readmission plan shall include, where 
        appropriate, a provision for implementing alternative 
        educational services upon readmission and may not be used to 
        extend the current suspension.  Consistent with section 125A.09, 
        subdivision 3, the readmission plan must not obligate a parent 
        to provide a sympathomimetic medication for the parent's child 
        as a condition of readmission.  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 to a 
        total of 15 days.  In the case of a student with a disability, 
        the student's individual education plan team must meet 
        immediately but not more than ten school days after the date on 
        which the decision to remove the student from the student's 
        current education placement is made.  The individual education 
        plan team shall at that meeting:  conduct a review of the 
        relationship between the child's disability and the behavior 
        subject to disciplinary action; and determine the 
        appropriateness of the child's education plan. 
           The requirements of the individual education plan team 
        meeting apply when: 
           (1) the parent requests a meeting; 
           (2) the student is removed from the student's current 
        placement for five or more consecutive days; or 
           (3) the student's total days of removal from the student's 
        placement during the school year exceed ten cumulative days in a 
        school year.  The school administration shall implement 
        alternative educational services when the suspension exceeds 
        five days.  A separate administrative conference is required for 
        each period of suspension. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 2.  Minnesota Statutes 2000, section 122A.31, is 
        amended to read: 
           122A.31 [AMERICAN SIGN LANGUAGE/ENGLISH INTERPRETERS.] 
           Subdivision 1.  [REQUIREMENTS FOR AMERICAN SIGN 
        LANGUAGE/ENGLISH INTERPRETERS.] (a) In addition to any other 
        requirements that a school district establishes, any person 
        employed to provide American sign language/English interpreting 
        or sign transliterating services on a full-time or part-time 
        basis for a school district after July 1, 2000, must: 
           (1) hold current interpreter and transliterator 
        certificates awarded by the Registry of Interpreters for the 
        Deaf (RID), or the general level interpreter proficiency 
        certificate awarded by the National Association of the Deaf 
        (NAD), or a comparable state certification from the commissioner 
        of children, families, and learning; and 
           (2) satisfactorily complete an interpreter/transliterator 
        training program affiliated with an accredited educational 
        institution. 
           (b) To provide American sign language/English interpreting 
        or transliterating services on a full-time or part-time basis, a 
        person employed in a school district during the 1999-2000 school 
        year must only comply with paragraph (a), clause (1).  The 
        commissioner shall grant a nonrenewable, one-year provisional 
        certificate to individuals who have not attained a current 
        applicable transliterator certificate pursuant to paragraph (a), 
        clause (1).  During the one-year provisional period, the 
        interpreter/transliterator must develop and implement an 
        education plan in collaboration with a mentor under paragraph 
        (d).  This paragraph shall expire on June 30, 2001. 
           (c) New graduates of an interpreter/transliterator program 
        affiliated with an accredited education institution shall be 
        granted a two-year provisional certificate by the commissioner.  
        During the two-year provisional period, the 
        interpreter/transliterator must develop and implement an 
        education plan in collaboration with a mentor under paragraph 
        (d) (c).  This paragraph applies to spring semester 2000 
        graduates and thereafter. 
           (d) (c) A mentor of a provisionally certified 
        interpreter/transliterator must be an interpreter/transliterator 
        who has either NAD level IV or V certification or RID certified 
        interpreter and certified transliterator certification and have 
        at least three years interpreting/transliterating experience in 
        any educational setting.  The mentor, in collaboration with the 
        provisionally certified interpreter/transliterator, shall 
        develop and implement an education plan designed to meet the 
        requirements of paragraph (a), clause (1), and include a weekly 
        on-site mentoring process. 
           (d) Consistent with the requirements of this paragraph, a 
        person holding a provisional certificate may apply to the 
        commissioner for one time-limited extension.  The commissioner, 
        in consultation with the commission serving deaf and 
        hard-of-hearing people, must grant the person a time-limited 
        extension of the provisional certificate based on the following 
        documentation: 
           (1) letters of support from the person's mentor, a parent 
        of a pupil the person serves, the special education director of 
        the district in which the person is employed, and a 
        representative from the regional service center of the deaf and 
        hard-of-hearing; 
           (2) records of the person's formal education, training, 
        experience, and progress on the person's education plan; and 
           (3) an explanation of why the extension is needed. 
           As a condition of receiving the extension, the person must 
        comply with a plan and the accompanying time line for meeting 
        the requirements of this subdivision.  A committee composed of 
        the director of the Minnesota resource center serving deaf and 
        hard-of-hearing, or the director's designee, a representative of 
        the Minnesota association of deaf citizens, a representative of 
        the Minnesota registry of interpreters of the deaf, and other 
        appropriate persons selected by the commissioner must develop 
        the plan and time line for the person receiving the extension. 
           (e) A school district may not employ only an 
        interpreter/transliterator who has not been certified under 
        paragraph (a), or (b), or (c) for whom a time-limited extension 
        has been granted under paragraph (d). 
           Subd. 2.  [ORAL OR CUED SPEECH TRANSLITERATORS.] (a) In 
        addition to any other requirements that a school district 
        establishes, any person employed to provide oral transliterating 
        or cued speech transliterating services on a full-time or 
        part-time basis for a school district after July 1, 2000, must 
        hold a current applicable transliterator certificate awarded by 
        the national certifying association or comparable state 
        certification from the commissioner of children, families, and 
        learning. 
           (b) To provide oral or cued speech transliterator services 
        on a full-time or part-time basis, a person employed in a school 
        district must comply with paragraph (a).  The commissioner shall 
        grant a nonrenewable, two-year certificate to a school district 
        on behalf of a person who has not yet attained a current 
        applicable transliterator certificate under paragraph (a).  A 
        person for whom a nonrenewable, two-year certificate is issued 
        must work under the direction of a licensed teacher who is 
        skilled in language development of individuals who are deaf or 
        hard-of-hearing.  A person for whom a nonrenewable, two-year 
        certificate is issued also must enroll in a state-approved 
        training program and demonstrate progress towards the 
        certification required under paragraph (a) sufficient for the 
        person to be certified at the end of the two-year period. 
           (c) Consistent with the requirements of this paragraph, a 
        person holding a provisional certificate may apply to the 
        commissioner for one time-limited extension.  The commissioner, 
        in consultation with the commission serving deaf and 
        hard-of-hearing people, must grant the person a time-limited 
        extension of the provisional certificate based on the following 
        documentation: 
           (1) letters of support from the person's mentor, a parent 
        of a pupil the person serves, the special education director of 
        the district in which the person is employed, and a 
        representative from the regional service center of the deaf and 
        hard-of-hearing; 
           (2) records of the person's formal education, training, 
        experience, and progress on the person's education plan; and 
           (3) an explanation of why the extension is needed. 
           As a condition of receiving the extension, the person must 
        comply with a plan and the accompanying time line for meeting 
        the requirements of this subdivision.  A committee composed of 
        the director of the Minnesota resource center serving deaf and 
        hard-of-hearing, or the director's designee, a representative of 
        the Minnesota association of deaf citizens, a representative of 
        the Minnesota registry of interpreters of the deaf, and other 
        appropriate persons selected by the commissioner must develop 
        the plan and time line for the person receiving the extension. 
           Subd. 3.  [QUALIFIED INTERPRETERS.] The department of 
        children, families, and learning and the resource center:  deaf 
        and hard of hearing shall work with existing 
        interpreter/transliterator training programs, other 
        training/educational institutions, and the regional service 
        centers to ensure that ongoing staff development training for 
        educational interpreters/transliterators is provided throughout 
        the state. 
           Subd. 4.  [REIMBURSEMENT.] (a) For purposes of revenue 
        under section 125A.78, the department of children, families, and 
        learning must only reimburse school districts for the services 
        of those interpreters/transliterators who satisfy the standards 
        of competency under this section.  
           (b) Notwithstanding paragraph (a), a district shall be 
        reimbursed for the services of interpreters with a nonrenewable 
        provisional certificate and, interpreters/transliterators 
        employed to mentor the provisional certified interpreters, and 
        persons for whom a time-limited extension has been granted under 
        subdivision 1, paragraph (d), or subdivision 2, paragraph (c). 
           [EFFECTIVE DATE.] This section is effective for the 
        2001-2002 school year and later. 
           Sec. 3.  Minnesota Statutes 2000, section 122A.61, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [STAFF DEVELOPMENT REVENUE.] A district is 
        required to reserve an amount equal to at least two percent of 
        the basic revenue under section 126C.10, subdivision 2, for 
        in-service education for programs under section 120B.22, 
        subdivision 2, for staff development plans, including plans for 
        challenging instructional activities and experiences under 
        section 122A.60, and for curriculum development and programs, 
        other in-service education, teachers' workshops, teacher 
        conferences, the cost of substitute teachers staff development 
        purposes, preservice and in-service education for special 
        education professionals and paraprofessionals, and other related 
        costs for staff development efforts.  A district may annually 
        waive the requirement to reserve their basic revenue under this 
        section if a majority vote of the licensed teachers in the 
        district and a majority vote of the school board agree to a 
        resolution to waive the requirement.  A district in statutory 
        operating debt is exempt from reserving basic revenue according 
        to this section.  Districts may expend an additional amount of 
        unreserved revenue for staff development based on their needs.  
        With the exception of amounts reserved for staff development 
        from revenues allocated directly to school sites, the board must 
        initially allocate 50 percent of the reserved revenue to each 
        school site in the district on a per teacher basis, which must 
        be retained by the school site until used.  The board may retain 
        25 percent to be used for district wide staff development 
        efforts.  The remaining 25 percent of the revenue must be used 
        to make grants to school sites for best practices methods.  A 
        grant may be used for any purpose authorized under section 
        120B.22, subdivision 2, 122A.60, or for the costs of curriculum 
        development and programs, other in-service education, teachers' 
        workshops, teacher conferences, substitute teachers for staff 
        development purposes, and other staff development efforts, and 
        determined by the site professional development team.  The site 
        professional development team must demonstrate to the school 
        board the extent to which staff at the site have met the 
        outcomes of the program.  The board may withhold a portion of 
        initial allocation of revenue if the staff development outcomes 
        are not being met. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 4.  Minnesota Statutes 2000, section 124D.65, 
        subdivision 5, is amended to read: 
           Subd. 5.  [SCHOOL DISTRICT LEP REVENUE.] (a) A school 
        district's limited English proficiency programs revenue for 
        fiscal year 2000 equals the state total limited English 
        proficiency programs revenue, minus the amount determined under 
        paragraph (b), times the ratio of the district's adjusted 
        limited English proficiency programs base revenue to the state 
        total adjusted limited English proficiency programs base revenue.
           (b) Notwithstanding paragraph (a), if the limited English 
        proficiency programs base revenue for a district equals zero, 
        the limited English proficiency programs revenue equals the sum 
        of the following amounts, computed using current 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. 
           (c) A district's limited English proficiency programs 
        revenue for fiscal year 2001 and later equals the product of 
        $584 times the greater of 20 or the number of adjusted marginal 
        cost pupils of limited English proficiency enrolled in the 
        district during the current fiscal year. 
           (d) A pupil ceases to generate state limited English 
        proficiency aid in the school year following the school year in 
        which the pupil attains the state cut-off score on a 
        commissioner-provided assessment that measures the pupil's 
        emerging academic English. 
           [EFFECTIVE DATE.] This section is effective July 1, 2002. 
           Sec. 5.  Minnesota Statutes 2000, section 125A.023, 
        subdivision 4, is amended to read: 
           Subd. 4.  [STATE INTERAGENCY COMMITTEE.] (a) The governor 
        shall convene an 18-member a 19-member interagency committee to 
        develop and implement a coordinated, multidisciplinary, 
        interagency intervention service system for children ages three 
        to 21 with disabilities.  The commissioners of commerce, 
        children, families, and learning, health, human rights, human 
        services, economic security, and corrections shall each appoint 
        two committee members from their departments; the association of 
        Minnesota counties shall appoint two county representatives, one 
        of whom must be an elected official, as committee members; and 
        the Minnesota school boards association, the Minnesota 
        administrators of special education, and the school nurse 
        association of Minnesota shall each appoint one committee 
        member.  The committee shall select a chair from among its 
        members. 
           (b) The committee shall: 
           (1) identify and assist in removing state and federal 
        barriers to local coordination of services provided to children 
        with disabilities; 
           (2) identify adequate, equitable, and flexible funding 
        sources to streamline these services; 
           (3) develop guidelines for implementing policies that 
        ensure a comprehensive and coordinated system of all state and 
        local agency services, including multidisciplinary assessment 
        practices for children with disabilities ages three to 21; 
           (4) develop, consistent with federal law, a standardized 
        written plan for providing services to a child with 
        disabilities; 
           (5) identify how current systems for dispute resolution can 
        be coordinated and develop guidelines for that coordination; 
           (6) develop an evaluation process to measure the success of 
        state and local interagency efforts in improving the quality and 
        coordination of services to children with disabilities ages 
        three to 21; 
           (7) develop guidelines to assist the governing boards of 
        the interagency early intervention committees in carrying out 
        the duties assigned in section 125A.027, subdivision 1, 
        paragraph (b); and 
           (8) carry out other duties necessary to develop and 
        implement within communities a coordinated, multidisciplinary, 
        interagency intervention service system for children with 
        disabilities. 
           (c) The committee shall consult on an ongoing basis with 
        the state education advisory committee for special education and 
        the governor's interagency coordinating council in carrying out 
        its duties under this section, including assisting the governing 
        boards of the interagency early intervention committees. 
           Sec. 6.  Minnesota Statutes 2000, section 125A.027, is 
        amended by adding a subdivision to read: 
           Subd. 4.  [RESPONSIBILITIES OF SCHOOL AND COUNTY 
        BOARDS.] (a) It is the joint responsibility of school and county 
        boards to coordinate, provide, and pay for appropriate services, 
        and to facilitate payment for services from public and private 
        sources.  Appropriate service for children eligible under 
        section 125A.02 and receiving service from two or more public 
        agencies of which one is the public school must be determined in 
        consultation with parents, physicians, and other education, 
        medical health, and human services providers.  The services 
        provided must be in conformity with an Individual Interagency 
        Intervention Plan (IIIP) for each eligible child ages 3 to 21. 
           (b) Appropriate services include those services listed on a 
        child's IIIP.  These services are those that are required to be 
        documented on a plan under federal and state law or rule. 
           (c) School and county boards shall coordinate interagency 
        services.  Service responsibilities for eligible children, ages 
        3 to 21, shall be established in interagency agreements or joint 
        powers board agreements.  In addition, interagency agreements or 
        joint powers board agreements shall be developed to establish 
        agency responsibility that assures that coordinated interagency 
        services are coordinated, provided, and paid for, and that 
        payment is facilitated from public and private sources.  School 
        boards must provide, pay for, and facilitate payment for special 
        education services as required under sections 125A.05 and 
        125A.06.  County boards must provide, pay for, and facilitate 
        payment for those programs over which they have service and 
        fiscal responsibility as referenced in section 125A.023, 
        subdivision 3, paragraph (d), clause (1). 
           Sec. 7.  Minnesota Statutes 2000, section 125A.08, is 
        amended to read: 
           125A.08 [SCHOOL DISTRICT OBLIGATIONS.] 
           (a) As defined in this section, every district must ensure 
        the following: 
           (1) all students with disabilities are provided the special 
        instruction and services which are appropriate to their needs.  
        Where the individual education plan team has determined 
        appropriate goals and objectives based on the student's needs, 
        including the extent to which the student can be included in the 
        least restrictive environment, and where there are essentially 
        equivalent and effective instruction, related services, or 
        assistive technology devices available to meet the student's 
        needs, cost to the district may be among the factors considered 
        by the team in choosing how to provide the appropriate services, 
        instruction, or devices that are to be made part of the 
        student's individual education plan.  The individual education 
        plan team shall consider and may authorize services covered by 
        medical assistance according to section 256B.0625, subdivision 
        26.  The student's needs and the special education instruction 
        and services to be provided must be agreed upon through the 
        development of an individual education plan.  The plan must 
        address the student's need to develop skills to live and work as 
        independently as possible within the community.  The individual 
        education plan team must consider positive behavioral 
        interventions, strategies, and supports that address behavior 
        for children with attention deficit disorder or attention 
        deficit hyperactivity disorder.  By grade 9 or age 14, the plan 
        must address the student's needs for transition from secondary 
        services to post-secondary education and training, employment, 
        community participation, recreation, and leisure and home 
        living.  In developing the plan, districts must inform parents 
        of the full range of transitional goals and related services 
        that should be considered.  The plan must include a statement of 
        the needed transition services, including a statement of the 
        interagency responsibilities or linkages or both before 
        secondary services are concluded; 
           (2) children with a disability under age five and their 
        families are provided special instruction and services 
        appropriate to the child's level of functioning and needs; 
           (3) children with a disability and their parents or 
        guardians are guaranteed procedural safeguards and the right to 
        participate in decisions involving identification, assessment 
        including assistive technology assessment, and educational 
        placement of children with a disability; 
           (4) eligibility and needs of children with a disability are 
        determined by an initial assessment or reassessment, which may 
        be completed using existing data under United States Code, title 
        20, section 33, et seq.; 
           (5) to the maximum extent appropriate, children with a 
        disability, including those in public or private institutions or 
        other care facilities, are educated with children who are not 
        disabled, and that special classes, separate schooling, or other 
        removal of children with a disability from the regular 
        educational environment occurs only when and to the extent that 
        the nature or severity of the disability is such that education 
        in regular classes with the use of supplementary services cannot 
        be achieved satisfactorily; 
           (6) in accordance with recognized professional standards, 
        testing and evaluation materials, and procedures used for the 
        purposes of classification and placement of children with a 
        disability are selected and administered so as not to be 
        racially or culturally discriminatory; and 
           (7) the rights of the child are protected when the parents 
        or guardians are not known or not available, or the child is a 
        ward of the state. 
           (b) For paraprofessionals employed to work in programs for 
        students with disabilities, the school board in each district 
        shall ensure that: 
           (1) before or immediately upon employment, each 
        paraprofessional develops sufficient knowledge and skills in 
        emergency procedures, building orientation, roles and 
        responsibilities, confidentiality, vulnerability, and 
        reportability, among other things, to begin meeting the needs of 
        the students with whom the paraprofessional works; 
           (2) annual training opportunities are available to enable 
        the paraprofessional to continue to further develop the 
        knowledge and skills that are specific to the students with whom 
        the paraprofessional works, including understanding 
        disabilities, following lesson plans, and implementing follow-up 
        instructional procedures and activities; and 
           (3) a districtwide process obligates each paraprofessional 
        to work under the ongoing direction of a licensed teacher and, 
        where appropriate and possible, the supervision of a school 
        nurse. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 8.  Minnesota Statutes 2000, section 125A.09, 
        subdivision 3, is amended to read: 
           Subd. 3.  [INITIAL ACTION; PARENT CONSENT.] (a) The 
        district must not proceed with the initial formal assessment of 
        a child, the initial placement of a child in a special education 
        program, or the initial provision of special education services 
        for a child without the prior written consent of the child's 
        parent or guardian.  The refusal of a parent or guardian to 
        consent may be overridden by the decision in a hearing held 
        pursuant to subdivision 6 at the district's initiative. 
           (b) A parent, after consulting with health care, education, 
        or other professional providers, may agree or disagree to 
        provide the parent's child with sympathomimetic medications 
        unless section 144.344 applies.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 9.  Minnesota Statutes 2000, section 125A.11, 
        subdivision 3, is amended to read: 
           Subd. 3.  [AGREEMENT BETWEEN DISTRICTS TO PROVIDE SPECIAL 
        INSTRUCTION AND SERVICES.] For the purposes of this section, any 
        school district may enter into an agreement, upon mutually 
        agreed upon terms and conditions, to provide special instruction 
        and services for children with a disability.  In that event, one 
        of the participating units may employ and contract with 
        necessary qualified personnel to offer services in the several 
        districts.  Each participating unit must reimburse the employing 
        unit a proportionate amount of the actual cost of providing the 
        special instruction and services, less the amount of state 
        special education aid, which shall be claimed in full by the 
        employing district.  
           Sec. 10.  Minnesota Statutes 2000, section 125A.27, 
        subdivision 15, is amended to read: 
           Subd. 15.  [PART H C STATE PLAN.] "Part H C state plan" 
        means the annual state plan application approved by the federal 
        government under the Individuals with Disabilities Education 
        Act, United States Code, title 20, section 1471 et seq. (Part H 
        C, Public Law Number 102-119 105-117). 
           Sec. 11.  Minnesota Statutes 2000, section 125A.515, is 
        amended to read: 
           125A.515 [PLACEMENT OF CHILDREN WITHOUT DISABILITIES; 
        APPROVAL OF EDUCATION PROGRAM.] 
           The commissioner shall approve education programs in care 
        and treatment facilities for placement of children without 
        disabilities, including detention centers, before being licensed 
        by the department of human services or the department of 
        corrections.  For the purposes of this section, care and 
        treatment facilities includes adult facilities that admit 
        children and provide an education program specifically designed 
        for children who are residents of the facility including 
        chemical dependency and other substance abuse programs, shelter 
        care facilities, hospitals, correctional facilities, mental 
        health programs, and detention facilities. 
           Sec. 12.  Minnesota Statutes 2000, section 125A.76, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DEFINITIONS.] For the purposes of this 
        section, the definitions in this subdivision apply. 
           (a) "Base year" for fiscal year 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 
        126C.10, subdivision 2.  For the purposes of computing basic 
        revenue pursuant to this section, each child with a disability 
        shall be counted as prescribed in section 126C.05, subdivision 1.
           (c) "Essential personnel" means teachers, cultural 
        liaisons, related services, and support services staff providing 
        direct services to students.  Essential personnel may also 
        include special education paraprofessionals or clericals 
        providing support to teachers and students by preparing 
        paperwork and making arrangements related to special education 
        compliance requirements, including parent meetings and 
        individual education plans. 
           (d) "Average daily membership" has the meaning given it in 
        section 126C.05. 
           (e) "Program growth factor" means 1.08 for fiscal year 
        2002, and 1.046 for fiscal year 2003 and later. 
           Sec. 13.  Minnesota Statutes 2000, section 125A.76, 
        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 fiscal year, not including the share of 
        salaries for personnel providing health-related services counted 
        in clause (8), whether the person is employed by one or more 
        districts or a Minnesota correctional facility operating on a 
        fee-for-service basis; 
           (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 amount of the basic revenue, as defined 
        in section 126C.10, subdivision 2, special education aid, and 
        any other aid earned on behalf of the child 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, not including 
        the portion of the expenses for supplies and equipment used to 
        provide health-related services counted in clause (8), an amount 
        equal to 47 percent of the sum actually expended by the 
        district, or a Minnesota correctional facility operating on a 
        fee-for-service basis, but not to exceed an average of $47 in 
        any one school year for each child with a disability receiving 
        instruction; 
           (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 123B.92, subdivision 1, paragraph (b), clause (4). 
           The department shall establish procedures through the 
        uniform financial accounting and reporting system to identify 
        and track all revenues generated from third-party billings as 
        special education revenue at the school district level; include 
        revenue generated from third-party billings as special education 
        revenue in the annual cross-subsidy report; and exclude 
        third-party revenue from calculation of excess cost aid to the 
        districts. 
           (b) If requested by a school district operating a special 
        education program during the base year for less than the full 
        fiscal year, or a school district in which is located a 
        Minnesota correctional facility operating on a fee-for-service 
        basis for less than the full fiscal 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 fiscal year. 
           (c) Notwithstanding paragraphs (a) and (b), the portion of 
        a school district's base revenue attributable to a Minnesota 
        correctional facility operating on a fee-for-service basis 
        during the facility's first year of operating on a 
        fee-for-service basis shall be computed using current year data. 
           Sec. 14.  Minnesota Statutes 2000, section 260A.01, is 
        amended to read: 
           260A.01 [TRUANCY PROGRAMS AND SERVICES.] 
           (a) The programs in this chapter are designed to provide a 
        continuum of intervention and services to support families and 
        children in keeping children in school and combating truancy and 
        educational neglect.  School districts, county attorneys, and 
        law enforcement may establish the programs and coordinate them 
        with other community-based truancy services in order to provide 
        the necessary and most effective intervention for children and 
        their families.  This continuum of intervention and services 
        involves progressively intrusive intervention, beginning with 
        strong service-oriented efforts at the school and community 
        level and involving the court's authority only when necessary. 
           (b) Consistent with section 125A.09, subdivision 3, a 
        parent's refusal to provide the parent's child with 
        sympathomimetic medications does not constitute educational 
        neglect.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 15.  Minnesota Statutes 2000, section 260C.163, 
        subdivision 11, is amended to read: 
           Subd. 11.  [PRESUMPTIONS REGARDING TRUANCY OR EDUCATIONAL 
        NEGLECT.] (a) A child's absence from school is presumed to be 
        due to the parent's, guardian's, or custodian's failure to 
        comply with compulsory instruction laws if the child is under 12 
        years old and the school has made appropriate efforts to resolve 
        the child's attendance problems; this presumption may be 
        rebutted based on a showing by clear and convincing evidence 
        that the child is habitually truant.  A child's absence from 
        school without lawful excuse, when the child is 12 years old or 
        older, is presumed to be due to the child's intent to be absent 
        from school; this presumption may be rebutted based on a showing 
        by clear and convincing evidence that the child's absence is due 
        to the failure of the child's parent, guardian, or custodian to 
        comply with compulsory instruction laws, sections 120A.22 and 
        120A.24. 
           (b) Consistent with section 125A.09, subdivision 3, a 
        parent's refusal to provide the parent's child with 
        sympathomimetic medications does not constitute educational 
        neglect.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 16.  Minnesota Statutes 2000, section 626.556, 
        subdivision 2, is amended to read: 
           Subd. 2.  [DEFINITIONS.] As used in this section, the 
        following terms have the meanings given them unless the specific 
        content indicates otherwise: 
           (a) "Sexual abuse" means the subjection of a child by a 
        person responsible for the child's care, by a person who has a 
        significant relationship to the child, as defined in section 
        609.341, or by a person in a position of authority, as defined 
        in section 609.341, subdivision 10, to any act which constitutes 
        a violation of section 609.342 (criminal sexual conduct in the 
        first degree), 609.343 (criminal sexual conduct in the second 
        degree), 609.344 (criminal sexual conduct in the third degree), 
        609.345 (criminal sexual conduct in the fourth degree), or 
        609.3451 (criminal sexual conduct in the fifth degree).  Sexual 
        abuse also includes any act which involves a minor which 
        constitutes a violation of prostitution offenses under sections 
        609.321 to 609.324 or 617.246.  Sexual abuse includes threatened 
        sexual abuse.  
           (b) "Person responsible for the child's care" means (1) an 
        individual functioning within the family unit and having 
        responsibilities for the care of the child such as a parent, 
        guardian, or other person having similar care responsibilities, 
        or (2) an individual functioning outside the family unit and 
        having responsibilities for the care of the child such as a 
        teacher, school administrator, or other lawful custodian of a 
        child having either full-time or short-term care 
        responsibilities including, but not limited to, day care, 
        babysitting whether paid or unpaid, counseling, teaching, and 
        coaching.  
           (c) "Neglect" means: 
           (1) failure by a person responsible for a child's care to 
        supply a child with necessary food, clothing, shelter, health, 
        medical, or other care required for the child's physical or 
        mental health when reasonably able to do so; 
           (2) failure to protect a child from conditions or actions 
        which imminently and seriously endanger the child's physical or 
        mental health when reasonably able to do so; 
           (3) failure to provide for necessary supervision or child 
        care arrangements appropriate for a child after considering 
        factors as the child's age, mental ability, physical condition, 
        length of absence, or environment, when the child is unable to 
        care for the child's own basic needs or safety, or the basic 
        needs or safety of another child in their care; 
           (4) failure to ensure that the child is educated as defined 
        in sections 120A.22 and 260C.163, subdivision 11, which does not 
        include a parent's refusal to provide the parent's child with 
        sympathomimetic medications, consistent with section 125A.09, 
        subdivision 3; 
           (5) nothing in this section shall be construed to mean that 
        a child is neglected solely because the child's parent, 
        guardian, or other person responsible for the child's care in 
        good faith selects and depends upon spiritual means or prayer 
        for treatment or care of disease or remedial care of the child 
        in lieu of medical care; except that a parent, guardian, or 
        caretaker, or a person mandated to report pursuant to 
        subdivision 3, has a duty to report if a lack of medical care 
        may cause serious danger to the child's health.  This section 
        does not impose upon persons, not otherwise legally responsible 
        for providing a child with necessary food, clothing, shelter, 
        education, or medical care, a duty to provide that care; 
           (6) prenatal exposure to a controlled substance, as defined 
        in section 253B.02, subdivision 2, used by the mother for a 
        nonmedical purpose, as evidenced by withdrawal symptoms in the 
        child at birth, results of a toxicology test performed on the 
        mother at delivery or the child at birth, or medical effects or 
        developmental delays during the child's first year of life that 
        medically indicate prenatal exposure to a controlled substance; 
           (7) "medical neglect" as defined in section 260C.007, 
        subdivision 4, clause (5); 
           (8) chronic and severe use of alcohol or a controlled 
        substance by a parent or person responsible for the care of the 
        child that adversely affects the child's basic needs and safety; 
        or 
           (9) emotional harm from a pattern of behavior which 
        contributes to impaired emotional functioning of the child which 
        may be demonstrated by a substantial and observable effect in 
        the child's behavior, emotional response, or cognition that is 
        not within the normal range for the child's age and stage of 
        development, with due regard to the child's culture. 
           (d) "Physical abuse" means any physical injury, mental 
        injury, or threatened injury, inflicted by a person responsible 
        for the child's care on a child other than by accidental means, 
        or any physical or mental injury that cannot reasonably be 
        explained by the child's history of injuries, or any aversive 
        and deprivation procedures that have not been authorized under 
        section 245.825.  Abuse does not include reasonable and moderate 
        physical discipline of a child administered by a parent or legal 
        guardian which does not result in an injury.  Actions which are 
        not reasonable and moderate include, but are not limited to, any 
        of the following that are done in anger or without regard to the 
        safety of the child: 
           (1) throwing, kicking, burning, biting, or cutting a child; 
           (2) striking a child with a closed fist; 
           (3) shaking a child under age three; 
           (4) striking or other actions which result in any 
        nonaccidental injury to a child under 18 months of age; 
           (5) unreasonable interference with a child's breathing; 
           (6) threatening a child with a weapon, as defined in 
        section 609.02, subdivision 6; 
           (7) striking a child under age one on the face or head; 
           (8) purposely giving a child poison, alcohol, or dangerous, 
        harmful, or controlled substances which were not prescribed for 
        the child by a practitioner, in order to control or punish the 
        child; or other substances that substantially affect the child's 
        behavior, motor coordination, or judgment or that results in 
        sickness or internal injury, or subjects the child to medical 
        procedures that would be unnecessary if the child were not 
        exposed to the substances; or 
           (9) unreasonable physical confinement or restraint not 
        permitted under section 609.379, including but not limited to 
        tying, caging, or chaining. 
           (e) "Report" means any report received by the local welfare 
        agency, police department, or county sheriff pursuant to this 
        section. 
           (f) "Facility" means a licensed or unlicensed day care 
        facility, residential facility, agency, hospital, sanitarium, or 
        other facility or institution required to be licensed under 
        sections 144.50 to 144.58, 241.021, or 245A.01 to 245A.16, or 
        chapter 245B; or a school as defined in sections 120A.05, 
        subdivisions 9, 11, and 13; and 124D.10; or a nonlicensed 
        personal care provider organization as defined in sections 
        256B.04, subdivision 16, and 256B.0625, subdivision 19a. 
           (g) "Operator" means an operator or agency as defined in 
        section 245A.02.  
           (h) "Commissioner" means the commissioner of human services.
           (i) "Assessment" includes authority to interview the child, 
        the person or persons responsible for the child's care, the 
        alleged perpetrator, and any other person with knowledge of the 
        abuse or neglect for the purpose of gathering the facts, 
        assessing the risk to the child, and formulating a plan.  
           (j) "Practice of social services," for the purposes of 
        subdivision 3, includes but is not limited to employee 
        assistance counseling and the provision of guardian ad litem and 
        parenting time expeditor services.  
           (k) "Mental injury" means an injury to the psychological 
        capacity or emotional stability of a child as evidenced by an 
        observable or substantial impairment in the child's ability to 
        function within a normal range of performance and behavior with 
        due regard to the child's culture. 
           (l) "Threatened injury" means a statement, overt act, 
        condition, or status that represents a substantial risk of 
        physical or sexual abuse or mental injury. 
           (m) Persons who conduct assessments or investigations under 
        this section shall take into account accepted child-rearing 
        practices of the culture in which a child participates, which 
        are not injurious to the child's health, welfare, and safety. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 17.  Laws 2000, chapter 489, article 3, section 24, is 
        amended to read: 
           Sec. 24.  [SPECIAL EDUCATION CROSS-SUBSIDY REVENUE.] 
           (a) For fiscal year 2000, a school district shall receive 
        an amount of revenue equal to $8.15 times the district's 
        adjusted marginal cost pupil units.  
           (b) For fiscal year 2001, a school district shall receive 
        an amount of revenue equal to $19 times the district's adjusted 
        marginal cost pupil units.  Special education cross-subsidy 
        revenue must be used to pay for a district's unfunded special 
        education costs that are currently cross-subsidized by a 
        district's general education revenue. 
           (c) The fiscal year 2001 revenue is paid entirely in fiscal 
        year 2001 based on estimated data.  By January 31, 2002, the 
        department of children, families, and learning shall recalculate 
        the revenue for each district using actual data, and shall 
        adjust the general education aid paid to school districts for 
        fiscal year 2002 by the amount of the difference between the 
        estimated revenue and the actual revenue. 
           Sec. 18.  [IDENTIFY REVENUE OPTIONS FOR COORDINATION OF 
        SERVICES.] 
           By July 1, 2002, the commissioner of children, families, 
        and learning shall, in conjunction with the commissioner of 
        human services, develop a plan to identify possible revenue 
        options from medical assistance funds, including targeted case 
        management, and other appropriate federal funds and develop a 
        recommended procedure for use at the local level for the purpose 
        of coordination of services needed to implement the individual 
        interagency intervention plan required in Minnesota Statutes, 
        section 125A.023, subdivision 4, paragraph (b), clause (4). 
           Sec. 19.  [STATE BILLING PROCESS.] 
           The commissioner of children, families, and learning, in 
        consultation with the commissioner of human services, shall 
        develop and recommend a billing process consistent with 
        Minnesota Statutes, sections 125A.21 and 125A.744, for school 
        districts to use to optimize processing third-party bills, 
        including medical assistance.  The commissioner of children, 
        families, and learning shall report to the legislature by 
        February 1, 2002, on recommendations for a billing system. 
           Sec. 20.  [BOARD OF TEACHING.] 
           The board of teaching must review and report to the 
        education committees of the 2002 legislature on rules that would 
        require board-approved teacher preparation programs to include 
        in their teacher preparation programs information on special 
        education laws, teaching strategies, and positive behavior 
        interventions.  
           Sec. 21.  [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 EDUCATION AID.] For special education 
        aid according to Minnesota Statutes, section 125A.75: 
             $507,448,000   .....     2002 
             $531,481,000   .....     2003 
           The 2002 appropriation includes $47,400,000 for 2001 and 
        $460,048,000 for 2002. 
           The 2003 appropriation includes $51,116,000 for 2002 and 
        $480,365,000 for 2003. 
           Subd. 3.  [AID FOR CHILDREN WITH A DISABILITY.] For aid 
        according to Minnesota Statutes, section 125A.75, subdivision 3, 
        for children with a disability placed in residential facilities 
        within the district boundaries for whom no district of residence 
        can be determined: 
             $1,877,000     .....     2002 
             $2,033,000     .....     2003 
           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. 4.  [TRAVEL FOR HOME-BASED SERVICES.] For aid for 
        teacher travel for home-based services according to Minnesota 
        Statutes, section 125A.75, subdivision 1: 
             $135,000       .....     2002 
             $138,000       .....     2003 
           The 2002 appropriation includes $13,000 for 2001 and 
        $122,000 for 2002. 
           The 2003 appropriation includes $13,000 for 2002 and 
        $125,000 for 2003. 
           Subd. 5.  [SPECIAL EDUCATION EXCESS COST AID.] For excess 
        cost aid: 
             $102,665,000   .....     2002 
             $104,773,000   .....     2003 
           The 2002 appropriation includes $9,889,000 for 2001 and 
        $92,776,000 for 2002. 
           The 2003 appropriation includes $10,308,000 for 2002 and 
        $94,465,000 for 2003. 
           Subd. 6.  [LITIGATION COSTS.] For paying the costs a 
        district incurs under Minnesota Statutes, section 125A.75, 
        subdivision 8: 
             $375,000       .....     2003 
           Subd. 7.  [TRANSITION PROGRAMS; STUDENTS WITH 
        DISABILITIES.] For aid for transition programs for pupils with 
        disabilities according to Minnesota Statutes, section 124D.454: 
             $8,954,000     .....     2002 
             $8,939,000     .....     2003 
           The 2002 appropriation includes $896,000 for 2001 and 
        $8,058,000 for 2002.  
           The 2003 appropriation includes $895,000 for 2002 and 
        $8,044,000 for 2003.  
           Subd. 8.  [COURT-PLACED SPECIAL EDUCATION REVENUE.] For 
        reimbursing serving school districts for unreimbursed eligible 
        expenditures attributable to children placed in the serving 
        school district by court action under Minnesota Statutes, 
        section 125A.79, subdivision 4: 
             $350,000       .....     2003 
           Subd. 9.  [OUT-OF-STATE TUITION SPECIAL EDUCATION.] For 
        special education out-of-state tuition according to Minnesota 
        Statutes, section 125A.79, subdivision 8: 
             $250,000       .....     2003 
           Subd. 10.  [USE OF SYMPATHOMIMETIC MEDICATIONS; STUDY.] For 
        the purpose of contracting with a qualified expert to determine 
        and report, consistent with Minnesota Statutes, chapter 13, the 
        number and overall incidence rate of Minnesota children ages 
        three to 18, by age, grade level, gender, and race, diagnosed 
        with attention deficit disorder (ADD) or attention deficit 
        hyperactivity disorder (ADHD) currently taking sympathomimetic 
        medications such as Ritalin: 
             $50,000     .....     2002 
           In preparing the report, the contractor also must determine 
        the number and overall incidence rate of children not identified 
        with ADD or ADHD currently taking sympathomimetic medications 
        such as Ritalin.  The contractor is encouraged to examine the 
        number of children who take sympathomimetic medications at home 
        and not at school, the previous interventions tried with 
        children taking sympathomimetic medications, the types of 
        practitioners who prescribe the sympathomimetic medications, and 
        what pressures families have experienced in terms of providing 
        their children with sympathomimetic medications.  The 
        commissioner must submit the report to the education committees 
        of the legislature by February 15, 2002. 
           Subd. 11.  [WEB-BASED, INDIVIDUAL INTERAGENCY INTERVENTION 
        PLAN.] For ongoing development, administration, and interagency 
        training costs associated with a statewide, Web-based 
        application for the individual interagency intervention plan 
        required in Minnesota Statutes, section 125A.023: 
             $250,000     .....     2002 
             $250,000     .....     2003 
           Subd. 12.  [HIV/STI EDUCATION.] For regional training sites 
        for HIV/STI education in schools established under Laws 1997, 
        First Special Session chapter 4, article 6, section 18: 
             $350,000     .....     2002 
           Of this amount, $300,000 must be used for continued 
        development of the existing sites and $50,000 for department of 
        children, families, and learning technical assistance and 
        contract management services.  This appropriation is available 
        until June 30, 2003. 

                                   ARTICLE 4 
                           FACILITIES AND TECHNOLOGY 
           Section 1.  Minnesota Statutes 2000, section 16B.616, 
        subdivision 4, is amended to read: 
           Subd. 4.  [ENFORCEMENT.] (a) A statutory or home rule 
        charter city that is not covered by the code because of action 
        taken under section 16B.72 or 16B.73 is responsible for 
        enforcement in the city of the code's requirements for bleacher 
        safety.  In all other areas where the code does not apply 
        because of action taken under section 16B.72 or 16B.73, the 
        county is responsible for enforcement of those requirements. 
           (b) Municipalities that have not adopted the code may 
        enforce the code requirements for bleacher safety by either 
        entering into a joint powers agreement for enforcement with 
        another municipality that has adopted the code or contracting 
        for enforcement with a qualified and certified building official 
        or state licensed design professional to enforce the code. 
           (c) Municipalities, school districts, organizations, 
        individuals, and other persons operating or owning places of 
        public accommodation with bleachers that are subject to the 
        safety requirements in subdivision 3 shall provide a signed 
        certification of compliance to the commissioner by January 1, 
        2002.  For bleachers subject to the exception in subdivision 3, 
        clause (1), entities covered by this paragraph must have on file 
        a bleacher safety management plan and amortization schedule.  
        The certification shall be prepared by a qualified and certified 
        building official or state licensed design professional and 
        shall certify that the bleachers have been inspected and are in 
        compliance with the requirements of this section and are 
        structurally sound.  For bleachers owned by a school district or 
        nonpublic school, the person the district or nonpublic school 
        designates to be responsible for buildings and grounds may make 
        the certification. 
           Sec. 2.  Minnesota Statutes 2000, section 123B.54, is 
        amended to read: 
           123B.54 [DEBT SERVICE APPROPRIATION.] 
           (a) $33,141,000 in fiscal year 2000, $29,400,000 in fiscal 
        year 2001, $26,934,000 in fiscal year 2002, and $24,540,000 in 
        fiscal year 2003 and each year thereafter is $25,989,000 in 
        fiscal year 2002, $35,163,000 in fiscal year 2003, $31,787,000 
        in fiscal year 2004, and $26,453,000 in fiscal years 2005 and 
        later are appropriated from the general fund to the commissioner 
        of children, families, and learning for payment of debt service 
        equalization aid under section 123B.53.  
           (b) The appropriations in paragraph (a) must be reduced by 
        the amount of any money specifically appropriated for the same 
        purpose in any year from any state fund. 
           Sec. 3.  Minnesota Statutes 2000, section 123B.57, 
        subdivision 3, is amended to read: 
           Subd. 3.  [HEALTH AND SAFETY REVENUE.] A district's health 
        and safety revenue for a fiscal year equals: 
           (1) the sum of (a) the total approved cost of the 
        district's hazardous substance plan for fiscal years 1985 
        through 1989, plus (b) the total approved cost of the district's 
        health and safety program for fiscal year 1990 through the 
        fiscal year to which the levy is attributable, excluding 
        expenditures funded with bonds issued under section 123B.59 or 
        123B.62, or chapter 475; certificates of indebtedness or capital 
        notes under section 123B.61; levies under section 123B.58, 
        123B.59, 123B.63, or 126C.40, subdivision 1 or 6; and other 
        federal, state, or local revenues, minus 
           (2) the sum of (a) the district's total hazardous substance 
        aid and levy for fiscal years 1985 through 1989 under sections 
        124.245 and 275.125, subdivision 11c, plus (b) the district's 
        health and safety revenue under this subdivision, for years 
        before the fiscal year to which the levy is attributable, plus 
        (c) the amount of other federal, state, or local receipts for 
        the district's hazardous substance or health and safety programs 
        for fiscal year 1985 through the fiscal year to which the levy 
        is attributable. 
           Sec. 4.  Minnesota Statutes 2000, section 123B.57, 
        subdivision 6, is amended to read: 
           Subd. 6.  [USES OF HEALTH AND SAFETY REVENUE.] Health and 
        safety revenue may be used only for approved expenditures 
        necessary to correct fire safety hazards, life safety hazards, 
        or for the removal or encapsulation of asbestos from school 
        buildings or property owned or being acquired by the district, 
        asbestos-related repairs, cleanup and disposal of 
        polychlorinated biphenyls found in school buildings or 
        property owned or being acquired by the district, or the 
        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 296A.01, labor 
        and industry regulated facility and equipment hazards, and 
        health, safety, and environmental management.  Health and safety 
        revenue must not be used to finance a lease purchase agreement, 
        installment purchase agreement, or other deferred payments 
        agreement.  Health and safety revenue must not be used for the 
        construction of new facilities or the purchase of portable 
        classrooms, for interest or other financing expenses, or for 
        energy efficiency projects under section 123B.65.  The revenue 
        may not be used for a building or property or part of a building 
        or property used for post-secondary instruction or 
        administration or for a purpose unrelated to elementary and 
        secondary education. 
           Sec. 5.  Minnesota Statutes 2000, section 123B.57, 
        subdivision 8, is amended to read: 
           Subd. 8.  [HEALTH, SAFETY, AND ENVIRONMENTAL MANAGEMENT 
        COST.] (a) A district's cost for health, safety, and 
        environmental management is limited to the lesser of:  
           (1) actual cost to implement their plan; or 
           (2) an amount determined by the commissioner, based on 
        enrollment, building age, and size. 
           (b) The department may contract with regional service 
        organizations, private contractors, Minnesota safety council, or 
        state agencies to provide management assistance to school 
        districts for health and safety capital projects.  Management 
        assistance is the development of written programs for the 
        identification, recognition and control of hazards, and 
        prioritization and scheduling of district health and safety 
        capital projects.  The department shall not exclude private 
        contractors from the opportunity to provide any health and 
        safety services to school districts. 
           (c) Notwithstanding paragraph (b), the department may 
        approve revenue, up to the limit defined in paragraph (a) for 
        districts having an approved health, safety, and environmental 
        management plan that uses district staff to accomplish 
        coordination and provided services. 
           Sec. 6.  Minnesota Statutes 2000, section 123B.59, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [TO QUALIFY.] An independent or special 
        school district qualifies to participate in the alternative 
        facilities bonding and levy program if the district has: 
           (1) more than 66 students per grade; 
           (2) over 1,850,000 square feet of space; 
           (3) and the average age of building space is 15 years or 
        older or over 1,500,000 square feet and the average age of 
        building space is 35 years or older; 
           (4) (3) insufficient funds from projected health and safety 
        revenue and capital facilities revenue to meet the requirements 
        for deferred maintenance, to make accessibility improvements, or 
        to make fire, safety, or health repairs; and 
           (5) (4) a ten-year facility plan approved by the 
        commissioner according to subdivision 2. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2004 and later. 
           Sec. 7.  Minnesota Statutes 2000, section 123B.71, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [CONSULTATION.] A school district shall 
        consult with the commissioner of children, families, and 
        learning before developing any plans and specifications to 
        construct, remodel, or improve the building or site of an 
        educational facility for which the estimated cost exceeds 
        $100,000 $250,000.  This consultation shall occur before a 
        referendum for bonds, solicitation for bids, or use of capital 
        expenditure facilities revenue according to section 126C.10, 
        subdivision 14, clause (2).  The commissioner may require the 
        district to participate in a management assistance plan before 
        conducting a review and comment on the project. 
           Sec. 8.  Minnesota Statutes 2000, section 123B.71, 
        subdivision 4, is amended to read: 
           Subd. 4.  [PLAN SUBMITTAL.] For a project for which 
        consultation is required under subdivision 1, the commissioner, 
        after the consultation required in subdivision 1, may require a 
        school district to submit the following preliminary and final 
        plans for approval:  
           (a) two sets of preliminary plans for each new building or 
        addition, and 
           (b) one set of final plans for each construction, 
        remodeling, or site improvement project.  The commissioner shall 
        approve or disapprove the plans within 90 days after submission. 
           Final plans shall meet all applicable state laws, rules, 
        and codes concerning public buildings, including sections 16B.59 
        to 16B.73.  The department may furnish to a school district 
        plans and specifications for temporary school buildings 
        containing two classrooms or less.  
           Sec. 9.  Minnesota Statutes 2000, section 123B.71, 
        subdivision 8, is amended to read: 
           Subd. 8.  [REVIEW AND COMMENT.] A school district, a 
        special education cooperative, or a cooperative unit of 
        government, as defined in section 123A.24, subdivision 2, 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 $500,000 per school site prior to review and comment 
        by the commissioner.  The commissioner may exempt a facility 
        maintenance project funded with general education aid and levy 
        or health and safety revenue from this provision after reviewing 
        a written request from a school district describing the scope of 
        work.  A school board shall not separate portions of a single 
        project into components to avoid the requirements of this 
        subdivision. 
           Sec. 10.  Minnesota Statutes 2000, section 123B.71, 
        subdivision 9, is amended to read: 
           Subd. 9.  [INFORMATION REQUIRED.] A school board proposing 
        to construct a facility described in subdivision 8 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; 
           (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. 
           (1) the geographic area and population to be served, 
        preschool through grade 12 student enrollments for the past five 
        years, and student enrollment projections for the next five 
        years; 
           (2) a list of existing facilities by year constructed, 
        their uses, and an assessment of the extent to which alternate 
        facilities are available within the school district boundaries 
        and in adjacent school districts; 
           (3) a list of the specific deficiencies of the facility 
        that demonstrate the need for a new or renovated facility to be 
        provided, and a list of the specific benefits that the new or 
        renovated facility will provide to the students, teachers, and 
        community users served by the facility; 
           (4) the relationship of the project to any priorities 
        established by the school district, educational cooperatives 
        that provide support services, or other public bodies in the 
        service area; 
           (5) a specification of how the project will increase 
        community use of the facility and whether and how the project 
        will increase collaboration with other governmental or nonprofit 
        entities; 
           (6) a description of the project, including the 
        specification of site and outdoor space acreage and square 
        footage allocations for classrooms, laboratories, and support 
        spaces; estimated expenditures for the major portions of the 
        project; and the dates the project will begin and be completed; 
           (7) a specification of the source of financing the project; 
        the scheduled date for a bond issue or school board action; a 
        schedule of payments, including debt service equalization aid; 
        and the effect of a bond issue on local property taxes by the 
        property class and valuation; 
           (8) an analysis of how the proposed new or remodeled 
        facility will affect school district operational or 
        administrative staffing costs, and how the district's operating 
        budget will cover any increased operational or administrative 
        staffing costs; 
           (9) a description of the consultation with local or state 
        road and transportation officials on school site access and 
        safety issues, and the ways that the project will address those 
        issues; 
           (10) a description of how indoor air quality issues have 
        been considered and a certification that the architects and 
        engineers designing the facility will have professional 
        liability insurance; 
           (11) as required under section 123B.72, for buildings 
        coming into service after July 1, 2002, a certification that the 
        plans and designs for the extensively renovated or new 
        facility's heating, ventilation, and air conditioning systems 
        will meet or exceed code standards; will provide for the 
        monitoring of outdoor airflow and total airflow of ventilation 
        systems; and will provide an indoor air quality filtration 
        system that meets ASHRAE standard 52.1; 
           (12) a specification of any desegregation requirements that 
        cannot be met by any other reasonable means; and 
           (13) a specification, if applicable, of how the facility 
        will utilize environmentally sustainable school facility design 
        concepts. 
           Sec. 11.  Minnesota Statutes 2000, section 125B.21, is 
        amended to read: 
           125B.21 [MINNESOTA EDUCATION TELECOMMUNICATIONS COUNCIL.] 
           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; one representative selected by the 
        commissioner of administration; eight representatives selected 
        by the commissioner of children, families, and learning, at 
        least one of which must come from each of the six higher 
        education telecommunication regions; a representative from the 
        office of technology; 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; and 
        two members, one selected from and representing the higher 
        education regional coordinators and one selected from and 
        representing the kindergarten through grade 12 cluster regions.  
        The council shall serve as a forum to establish and advocate for 
        a statewide vision and plans for the use of distance learning 
        technologies, including: 
           (1) develop a statewide vision and plans for the use of 
        distance learning technologies and provide leadership in 
        implementing the use of such technologies the coordination and 
        collaboration of distance learning opportunities; 
           (2) recommend educational policy relating to 
        telecommunications the implementation of the use of distance 
        learning technologies; 
           (3) determine priorities for use the collaboration of 
        distance learning users; 
           (4) oversee coordination of networks for post-secondary 
        campuses, kindergarten through grade 12 education, and regional 
        and community libraries the implementation of educational policy 
        relating to telecommunications; 
           (5) review application for telecommunications access grants 
        under Minnesota Statutes, section 125B.20, and recommend to the 
        department grants for funding the exchange of ideas; 
           (6) determine priorities for grant funding proposals the 
        communications with state government and related agencies and 
        entities; and 
           (7) work with the information policy office to ensure 
        consistency of the operation of the learning network with 
        standards of an open system architecture the coordination of 
        networks for post-secondary campuses, kindergarten through grade 
        12 education, and regional and community libraries; and 
           (8) the promotion of 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.  
           Subd. 2.  [DISTRICT COUNCIL MEMBERSHIP.] District 
        organizations that coordinate applications for telecommunication 
        access grants are encouraged to become members of the regional 
        higher education telecommunication council in their area. 
           Subd. 3.  [CRITERIA.] In addition to responsibilities of 
        the council under Laws 1993, First Special Session chapter 2, as 
        amended, the telecommunications council shall evaluate grant 
        applications under section 125B.20 and applications from 
        district organizations using the following criteria: 
           (1) evidence of cooperative arrangements with other 
        post-secondary institutions, school districts, and community and 
        regional libraries in the geographic region; 
           (2) plans for shared classes and programs; 
           (3) avoidance of network duplication; 
           (4) evidence of efficiencies to be achieved in delivery of 
        instruction due to use of telecommunications; 
           (5) a plan for development of a list of all courses 
        available in the region for delivery at a distance; 
           (6) a plan for coordinating and scheduling courses; and 
           (7) a plan for evaluation of costs, access, and outcomes. 
           Sec. 12.  Minnesota Statutes 2000, section 125B.25, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [COSTS TO BE SUBMITTED.] A district shall 
        submit its outstanding ongoing or recurring telecommunications 
        access costs associated with data lines and video links 
        connections to the department of children, families, and 
        learning.  Costs of telecommunications hardware or equipment 
        must not be included in the costs submitted by districts to the 
        department.  A district may include installation charges 
        associated with new lines or upgraded lines, but may not include 
        costs of hardware or equipment. 
           Sec. 13.  Minnesota Statutes 2000, section 125B.25, 
        subdivision 2, is amended to read: 
           Subd. 2.  [GUARANTEED MINIMUM ACCESS.] (a) The ongoing or 
        recurring telecommunications access costs submitted to the 
        department by each district under this section are limited to 
        the operation costs equal to the greater of: 
           (1) one data line or video link connection that relies on a 
        transport medium that operates at a minimum speed of 1.544 
        megabytes per second for each elementary school, middle school, 
        or high school under section 120A.05, subdivisions 9, 11, and 
        13; or 
           (2) one data line or video link connection that relies on a 
        transport medium that operates at a minimum speed of 1.544 
        megabytes per second for each district. 
           (b) A district may include costs associated with 
        cooperative arrangements with other post-secondary institutions, 
        school districts, and community and regional libraries in its 
        geographic region.  A district may continue to purchase its 
        ongoing or recurring telecommunications access services through 
        existing contracts. 
           Sec. 14.  Minnesota Statutes 2000, section 125B.25, 
        subdivision 6, is amended to read: 
           Subd. 6.  [REVENUE FOR CHARTER SCHOOLS.] (a) Each charter 
        school shall receive revenue equal to the greater of: 
           (1) the per marginal cost pupil unit amount for the 
        district in which the charter school is located as determined by 
        the commissioner according to subdivision 4; or 
           (2) $5; 
        times the adjusted marginal cost pupil units for that year, 
        times 65 percent. 
           (b) A charter school's revenue under this subdivision must 
        be used to pay for ongoing or recurring telecommunication access 
        costs, including access to data lines, and video lines 
        connections, or including Internet access. 
           Sec. 15.  Minnesota Statutes 2000, section 126C.40, 
        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 revenue authorized under section 126C.10, 
        subdivision 13, is insufficient for this purpose, it may apply 
        to the commissioner for permission to make an additional capital 
        expenditure levy for this purpose.  An application for 
        permission to levy under this subdivision must contain financial 
        justification for the proposed levy, the terms and conditions of 
        the proposed lease, and a description of the space to be leased 
        and its proposed use.  
           (b) The criteria for approval of applications to levy under 
        this subdivision must include:  the reasonableness of the price, 
        the appropriateness of the space to the proposed activity, the 
        feasibility of transporting pupils to the leased building or 
        land, conformity of the lease to the laws and rules of the state 
        of Minnesota, and the appropriateness of the proposed lease to 
        the space needs and the financial condition of the district.  
        The commissioner must not authorize a levy under this 
        subdivision in an amount greater than the cost to the district 
        of renting or leasing a building or land for approved purposes.  
        The proceeds of this levy must not be used for custodial or 
        other maintenance services.  A district may not levy under this 
        subdivision for the purpose of leasing or renting a 
        district-owned building or site to itself. 
           (c) For agreements finalized after July 1, 1997, a district 
        may not levy under this subdivision for the purpose of leasing:  
        (1) a newly constructed building used primarily for regular 
        kindergarten, elementary, or secondary instruction; or (2) a 
        newly constructed building addition or additions used primarily 
        for regular kindergarten, elementary, or secondary instruction 
        that contains more than 20 percent of the square footage of the 
        previously existing building. 
           (d) Notwithstanding paragraph (b), a district may levy 
        under this subdivision for the purpose of leasing or renting a 
        district-owned building or site to itself only if the amount is 
        needed by the district to make payments required by a lease 
        purchase agreement, installment purchase agreement, or other 
        deferred payments agreement authorized by law, and the levy 
        meets the requirements of paragraph (c).  A levy authorized for 
        a district by the commissioner under this paragraph may be in 
        the amount needed by the district to make payments required by a 
        lease purchase agreement, installment purchase agreement, or 
        other deferred payments agreement authorized by law, provided 
        that any agreement include a provision giving the school 
        districts the right to terminate the agreement annually without 
        penalty. 
           (e) The total levy under this subdivision for a district 
        for any year must not exceed $100 times the resident pupil units 
        for the fiscal year to which the levy is attributable. 
           (f) For agreements for which a review and comment have been 
        submitted to the department of children, families, and learning 
        after April 1, 1998, the term "instructional purpose" as used in 
        this subdivision excludes expenditures on stadiums. 
           (g) The commissioner of children, families, and learning 
        may authorize a school district to exceed the limit in paragraph 
        (e) if the school district petitions the commissioner for 
        approval.  The commissioner shall grant approval to a school 
        district to exceed the limit in paragraph (e) for not more than 
        five years if the district meets the following criteria: 
           (1) the school district has been experiencing pupil 
        enrollment growth in the preceding five years; 
           (2) the purpose of the increased levy is in the long-term 
        public interest; 
           (3) the purpose of the increased levy promotes colocation 
        of government services; and 
           (4) the purpose of the increased levy is in the long-term 
        interest of the district by avoiding over construction of school 
        facilities. 
           (h) A school district that is a member of an intermediate 
        school district may include in its authority under this section 
        the costs associated with leases of administrative and classroom 
        space for intermediate school district programs.  This authority 
        must not exceed $25 times the adjusted marginal cost pupil units 
        of the member districts.  This authority is in addition to any 
        other authority authorized under this section. 
           Sec. 16.  Minnesota Statutes 2000, section 126C.63, 
        subdivision 8, is amended to read: 
           Subd. 8.  [MAXIMUM EFFORT DEBT SERVICE LEVY.] "Maximum 
        effort debt service levy" means the lesser of: 
           (1) a levy in whichever of the following amounts is 
        applicable: 
           (a) in any district receiving a debt service loan for a 
        debt service levy payable in 2002 and thereafter, or granted a 
        capital loan after January 1, 2001, a levy in total dollar 
        amount computed at a rate of 30 percent of adjusted net tax 
        capacity for taxes payable in 2002 and thereafter; 
           (b) in any district receiving a debt service loan for a 
        debt service levy payable in 1991 and thereafter, or granted a 
        capital loan after January 1, 1990, a levy in a total dollar 
        amount computed at a rate of 24 percent of adjusted net tax 
        capacity for taxes payable in 1991 and thereafter; 
           (b) (c) in any district granted a debt service loan after 
        July 31, 1981, or granted a capital loan which is approved after 
        July 31, 1981, a levy in a total dollar amount computed as a tax 
        rate of 21.92 percent on the adjusted net tax capacity for taxes 
        payable in 1991 and thereafter; or 
           (2) a levy in any district for which a capital loan was 
        approved prior to August 1, 1981, a levy in a total dollar 
        amount equal to the sum of the amount of the required debt 
        service levy and an amount which when levied annually will in 
        the opinion of the commissioner be sufficient to retire the 
        remaining interest and principal on any outstanding loans from 
        the state within 30 years of the original date when the capital 
        loan was granted.  
           The board in any district affected by the provisions of 
        clause (2) may elect instead to determine the amount of its levy 
        according to the provisions of clause (1).  If a district's 
        capital loan is not paid within 30 years because it elects to 
        determine the amount of its levy according to the provisions of 
        clause (2), the liability of the district for the amount of the 
        difference between the amount it levied under clause (2) and the 
        amount it would have levied under clause (1), and for interest 
        on the amount of that difference, must not be satisfied and 
        discharged pursuant to Minnesota Statutes 1988, or an earlier 
        edition of Minnesota Statutes if applicable, section 124.43, 
        subdivision 4. 
           Sec. 17.  Minnesota Statutes 2000, section 126C.69, 
        subdivision 2, is amended to read: 
           Subd. 2.  [CAPITAL LOANS ELIGIBILITY.] Beginning July 1, 
        1999, a district is not eligible for a capital loan unless the 
        district's estimated net debt tax rate as computed by the 
        commissioner after debt service equalization aid would be more 
        than 24 30 percent of adjusted net tax capacity.  The estimate 
        must assume a 20-year maturity schedule for new debt. 
           Sec. 18.  Minnesota Statutes 2000, section 126C.69, 
        subdivision 9, is amended to read: 
           Subd. 9.  [LOAN AMOUNT LIMITS.] (a) A loan must not be 
        recommended for approval for a district exceeding an amount 
        computed as follows: 
           (1) the amount requested by the district under subdivision 
        6; 
           (2) plus the aggregate principal amount of general 
        obligation bonds of the district outstanding on June 30 of the 
        year following the year the application was received, not 
        exceeding the limitation on net debt of the district in section 
        475.53, subdivision 4, or 363 450 percent of its adjusted net 
        tax capacity as most recently determined, whichever is less; 
           (3) less the maximum net debt permissible for the district 
        on December 1 of the year the application is received, under the 
        limitation in section 475.53, subdivision 4, or 363 450 percent 
        of its adjusted net tax capacity as most recently determined, 
        whichever is less; 
           (4) less any amount by which the amount voted exceeds the 
        total cost of the facilities for which the loan is granted.  
           (b) The loan may be approved in an amount computed as 
        provided in paragraph (a), clauses (1) to (3), subject to later 
        reduction according to paragraph (a), clause (4). 
           Sec. 19.  Laws 2000, chapter 489, article 5, section 21, is 
        amended to read: 
           Sec. 21.  [ONE-TIME DEFERRED MAINTENANCE AID.] 
           (a) For fiscal year 2001 only, a district's one-time 
        deferred maintenance aid is equal to: 
           (1) $10 times the adjusted marginal cost pupil units for 
        the school year; plus 
           (2) $21.90 times the adjusted marginal cost pupil units for 
        the school year for a district that does not qualify for 
        alternative facilities bonding under Minnesota Statutes, section 
        123B.59, or under Laws 1999, chapter 241, article 4, section 25. 
           (b) Aid received under this section must be used for 
        deferred maintenance, to make accessibility improvements, or to 
        make fire, safety, or health repairs. 
           (c) This aid is paid entirely in fiscal year 2001 based on 
        estimated data.  By January 31, 2002, the department of 
        children, families, and learning shall recalculate the aid for 
        each district using actual data, and shall adjust the general 
        education aid paid to school districts for fiscal year 2002 by 
        the amount of the difference between the estimated aid and the 
        actual aid. 
           Sec. 20.  Laws 2000, chapter 489, article 7, section 15, 
        subdivision 3, is amended to read: 
           Subd. 3.  [COOPERATIVE SECONDARY FACILITY FACILITIES NEEDS; 
        PLANNING AND EXPENSES.] For a grant and administrative expenses 
        to facilitate for facilities and curricular planning for a 
        cooperative secondary facility under a joint powers agreement 
        for school district districts Nos. 411, Balaton, 402, Hendricks, 
        403, Ivanhoe, 404, Lake Benton, 418, Russell, 584, Ruthton, and 
        409, Tyler: 
               $100,000     .....     2001 2002
           This is a one-time appropriation.  This appropriation is 
        available until June 30, 2003. 
           Sec. 21.  [INTERMEDIATE SCHOOL DISTRICTS; BONDING AUTHORITY 
        WITHOUT VOTER APPROVAL.] 
           Subdivision 1.  [INTERMEDIATE SCHOOL DISTRICT NO. 
        916.] Notwithstanding Minnesota Statutes, chapter 136D, the 
        school board of intermediate school district No. 916 may sell 
        and issue up to $2,000,000 in bonds for acquisition and 
        betterment purposes upon adoption of a resolution by the board 
        authorizing the bonds.  
           The bonds shall be general obligations of the intermediate 
        school district; however, each member school district must each 
        year certify its proportionate share of the debt service levy on 
        the bonds, with the allocation of its share of that levy 
        determined in accordance with the resolution authorizing the 
        project previously adopted by each member school board.  For 
        purposes of section 123B.53, the debt service levies certified 
        for this purpose by an individual member school district shall 
        be considered debt service levies of that school district.  By 
        July 1 and December 1 of each year, the school board of each 
        member school district shall transfer to the intermediate school 
        district an amount equal to 50 percent of the debt service levy 
        certified by that member school district in the previous fiscal 
        year to pay its proportionate share. 
           Subd. 2.  [INTERMEDIATE SCHOOL DISTRICT NO. 
        917.] Notwithstanding Minnesota Statutes, chapter 136D, the 
        school board of intermediate school district No. 917 may sell 
        and issue up to $5,000,000 in bonds for acquisition and 
        betterment purposes upon adoption of a resolution by the board 
        authorizing the bonds. 
           The bonds shall be general obligations of the intermediate 
        school district; however, each member school district must each 
        year certify its proportionate share of the debt service levy on 
        the bonds, with the allocation of its share of that levy 
        determined in accordance with the resolution authorizing the 
        project previously adopted by each member school board.  For 
        purposes of section 123B.53, the debt service levies certified 
        for this purpose by an individual member school district shall 
        be considered debt service levies of that school district.  By 
        July 1 and December 1 of each year, the school board of each 
        member school district shall transfer to the intermediate school 
        district an amount equal to 50 percent of the debt service levy 
        certified by that member school district in the previous fiscal 
        year to pay its proportionate share. 
           Sec. 22.  [ENVIRONMENTALLY SUSTAINABLE SCHOOL FACILITIES.] 
           The department of administration must provide information 
        to a school district interested in providing environmentally 
        sustainable facilities. 
           Sec. 23.  [BONDING AUTHORIZATION.] 
           To provide funds for the acquisition or betterment of 
        school facilities, independent school district No. 625, St. 
        Paul, may by two-thirds majority vote of all the members of the 
        board of directors issue general obligation bonds in one or more 
        series in calendar years 2003 to 2008, both inclusive, as 
        provided in this section.  The aggregate principal amount of any 
        bonds issued under this section for each calendar year must not 
        exceed $15,000,000.  Issuance of the bonds is not subject to 
        Minnesota Statutes, section 475.58 or 475.59.  The bonds must 
        otherwise be issued as provided in Minnesota Statutes, chapter 
        475.  The authority to issue bonds under this section is in 
        addition to any bonding authority authorized by Minnesota 
        Statutes, chapter 123B, or other law.  The amount of bonding 
        authority authorized under this section must be disregarded in 
        calculating the bonding limit of Minnesota Statutes, chapter 
        123B, or any other law other than Minnesota Statutes, section 
        475.53, subdivision 4. 
           Sec. 24.  [TAX LEVY FOR DEBT SERVICE.] 
           To pay the principal of and interest on bonds issued under 
        section 11, independent school district No. 625, St. Paul, must 
        levy a tax annually in an amount sufficient under Minnesota 
        Statutes, section 475.61, subdivisions 1 and 3, to pay the 
        principal of and interest on the bonds.  The tax authorized 
        under this section is in addition to the taxes authorized to be 
        levied under Minnesota Statutes, chapter 123B, 124D, or 126C, or 
        other law. 
           Sec. 25.  [INTERACTIVE WEB-BASED AND INDEPENDENT STUDY 
        PROGRAMS.] 
           Subdivision 1.  [PUPIL REVENUE.] (a) General education 
        revenue for an eligible pupil in an approved interactive 
        Web-based program offered by a school district or a charter 
        school, or an approved alternative program that has an 
        independent study component offered by a charter school, under 
        the supervision of a teacher with a Minnesota license, must be 
        paid for each hour of completed coursework needed for grade 
        progression, credit, or alignment with state graduation 
        standards.  For purposes of this section, an eligible pupil is a 
        public school pupil concurrently enrolled in the district or 
        charter school or concurrently enrolled in another district or 
        charter school and participating in the program by agreement 
        with the district or charter school of enrollment.  The course 
        of study must be approved by the commissioner of children, 
        families, and learning for alignment with the state graduation 
        standards and compliance with Minnesota Statutes, chapter 125A.  
        An alternative program that has an independent study component 
        must also meet the requirements of Minnesota Statutes, section 
        126C.05, subdivision 15, paragraph (b), clauses (i) and (iv).  
        Average daily membership for a pupil shall equal the number of 
        hours of coursework completed divided by the number of hours 
        required for a full-time student in the district or charter 
        school.  Pupils enrolled in the program must not be counted as 
        more than 1.0 pupil in average daily membership.  A school 
        district or charter school is not required to provide a pupil 
        enrolled in the program with access to a computer or to the 
        Internet. 
           (b) Notwithstanding paragraph (a), pupils enrolled in a 
        Web-based public alternative program approved by the 
        commissioner before June 1, 2001, are not required to be 
        concurrently enrolled in the district and may be counted as more 
        than 1.0 pupil in average daily membership under Minnesota 
        Statutes, section 126C.05, subdivision 15. 
           (c) Notwithstanding paragraph (a), pupils enrolled in a 
        charter school with a Web-based program, approved by the 
        commissioner before June 1, 2001, are not required to be 
        concurrently enrolled in the charter school. 
           (d) Notwithstanding paragraph (a), pupils enrolled in a 
        charter school with an alternative program that has an 
        independent study component, approved by the commissioner for 
        fiscal year 2001, may be counted as more than 1.0 pupil in 
        average daily membership under Minnesota Statutes, section 
        126C.05, subdivision 15, paragraph (b), clause (iii). 
           Subd. 2.  [REIMBURSEMENT.] Notwithstanding Minnesota 
        Statutes, section 126C.19, subdivision 4, for fiscal year 2002 
        only, the commissioner shall establish a process for providing 
        additional revenue to school districts or charter schools for: 
           (1) an eligible pupil in an approved interactive Web-based 
        program under subdivision 1, paragraph (a), that may be counted 
        as more than 1.0 pupil in average daily membership; or 
           (2) a nonpublic pupil in an approved interactive Web-based 
        program in a public school under subdivision 1, paragraph (a).  
        The commissioner may award additional general education revenue 
        to school districts and charter schools up to the amount 
        appropriated for this section.  The amount of additional revenue 
        awarded to a school district under this section shall be based 
        on additional pupils in average daily membership that are 
        generated according to this subdivision with the prior approval 
        from the commissioner.  The commissioner shall establish a 
        process to prioritize the awards under this subdivision based on 
        the estimated number of students the school district or charter 
        school expects to serve under this section. 
           [EFFECTIVE DATE.] This section is effective for revenue for 
        fiscal year 2002 only. 
           Sec. 26.  [BUILDING REMODELING.] 
           If the commissioner of human services uses a portion of its 
        appropriation for repairs and betterments to remodel building 6 
        at the Brainerd regional human services center to make the 
        structure suitable for school programs, the Brainerd school 
        district may levy an amount equal to district appropriations for 
        taxes payable in 2002 and to reimburse the commissioner for 
        these remodeling costs. 
           Sec. 27.  [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.  [HEALTH AND SAFETY AID.] For health and safety 
        aid according to Minnesota Statutes, section 123B.57, 
        subdivision 5: 
             $14,980,000    .....     2002 
             $14,550,000    .....     2003 
           The 2002 appropriation includes $1,480,000 for 2001 and 
        $13,500,000 for 2002. 
           The 2003 appropriation includes $1,500,000 for 2002 and 
        $13,050,000 for 2003. 
           Subd. 3.  [DEBT SERVICE AID.] For debt service aid 
        according to Minnesota Statutes, section 123B.53, subdivision 6: 
             $25,989,000    .....     2002 
             $35,523,000    .....     2003 
           The 2002 appropriation includes $2,890,000 for 2001 and 
        $23,099,000 for 2002. 
           The 2003 appropriation includes $2,567,000 for 2002 and 
        $32,956,000 for 2003. 
           Subd. 4.  [INTERACTIVE TELEVISION (ITV) AID.] For 
        interactive television (ITV) aid under Minnesota Statutes, 
        section 126C.40, subdivision 4: 
             $1,418,000     .....     2002 
             $  129,000     .....     2003 
           The 2002 appropriation includes $260,000 for 2001 and 
        $1,158,000 for 2002. 
           The 2003 appropriation includes $129,000 for 2002 and $0 
        for 2003. 
           Subd. 5.  [ALTERNATIVE FACILITIES BONDING AID.] For 
        alternative facilities bonding aid, according to Minnesota 
        Statutes, section 123B.59, subdivision 1: 
             $19,279,000    .....     2002 
             $19,287,000    .....     2003 
           The 2002 appropriation includes $1,921,000 for 2001 and 
        $17,358,000 for 2002. 
           The 2003 appropriation includes $1,929,000 for 2002 and 
        $17,358,000 for 2003. 
           Subd. 6.  [TELECOMMUNICATION ACCESS COST REVENUE.] For 
        telecommunication access cost revenue under Minnesota Statutes, 
        section 125B.25: 
             $15,387,000    .....     2002 
             $ 1,565,000    .....     2003 
           The 2002 appropriation includes $1,300,000 for 2001 and 
        $14,087,000 for 2002. 
           The 2003 appropriation includes $1,565,000 for 2002 and $0 
        for 2003. 
           If the appropriation amount is insufficient, the 
        commissioner shall reduce the reimbursement rate in Minnesota 
        Statutes, section 125B.25, subdivisions 5 and 6, and the revenue 
        for the 2001-2002 school year shall be prorated.  The 
        reimbursement rate shall not exceed 100 percent. 
           Subd. 7.  [FLOODS; DECLINING PUPIL AID.] For declining 
        pupil aid under Laws 1999, chapter 241, article 4, section 23: 
             $  829,000     .....     2002 
             $   92,000     .....     2003 
           The 2002 appropriation includes $0 for 2001 and $829,000 
        for 2002. 
           The 2003 appropriation includes $92,000 for 2002 and $0 for 
        2003.  
           Subd. 8.  [ELECTRONIC LIBRARY FOR MINNESOTA.] For statewide 
        licenses to on-line databases selected in cooperation with the 
        higher education services office for school media centers, 
        public libraries, state government agency libraries, and public 
        or private college or university libraries: 
             $400,000     .....     2002 
             $400,000     .....     2003 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Subd. 9.  [REIMBURSEMENT FOR WEB-BASED AND INDEPENDENT 
        STUDY COURSES.] For grants to school districts and charter 
        schools for additional pupils taking on-line courses according 
        to section 25: 
             $100,000     .....     2002 
           Sec. 28.  [REPEALER.] 
           Minnesota Statutes 2000, section 123B.71, subdivisions 3 
        and 10, are repealed. 

                                   ARTICLE 5 
                NUTRITION; SCHOOL ACCOUNTING; AND OTHER PROGRAMS 
           Section 1.  Minnesota Statutes 2000, section 123B.80, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [COMMISSIONER'S AUTHORIZATION.] The 
        commissioner may authorize a board to transfer money from any 
        fund or account other than the debt redemption fund to another 
        fund or account according to this section. 
           Sec. 2.  [124D.1156] [FAST BREAK TO LEARNING BREAKFAST 
        PROGRAM.] 
           Subdivision 1.  [ELIGIBILITY.] The commissioner shall 
        provide funding to the 41 targeted breakfast program grant 
        recipients under Laws 1997, First Special Session chapter 4, 
        article 6, section 19, and then to public or nonpublic 
        elementary schools that participate in the federal School 
        Breakfast and Lunch Programs where at least 33 percent of the 
        lunches served to children during the second preceding school 
        year were provided free or at a reduced price.  Schools shall 
        not charge student households for fast break to learning meals.  
        Schools shall encourage all children to eat a nutritious 
        breakfast, either at home or at school, and shall work to 
        eliminate barriers to participation at school such as inadequate 
        facilities and transportation. 
           Subd. 2.  [PROGRAM.] The fast break to learning school 
        breakfast program enables schools participating in the federal 
        School Breakfast and Lunch Programs to cover the costs for 
        school breakfast without charging student households. 
           Subd. 3.  [PROGRAM REIMBURSEMENT.] State funds are provided 
        to reimburse fast break to learning school breakfasts.  Each 
        school year, the state must reimburse schools for the difference 
        between the per meal federal rate of reimbursement and the per 
        meal state average cost.  Meals that are reimbursed at a federal 
        rate that is equal to or higher than the state average cost do 
        not qualify for fast break to learning funds.  Schools must use 
        the funds to provide school breakfast to school children every 
        day school is in session. 
           Sec. 3.  [124D.1195] [COMMODITY DONATED FOOD REVOLVING 
        FUND.] 
           A revolving fund is established for the purpose of 
        depositing cash received for commodity donated foods that have 
        been lost, damaged, recalled, or diverted for processing.  The 
        state shall use the fund to issue payments for the value of the 
        lost, damaged, recalled, or diverted commodity donated foods and 
        related costs. 
           Sec. 4.  Minnesota Statutes 2000, section 127A.41, 
        subdivision 8, is amended to read: 
           Subd. 8.  [APPROPRIATION TRANSFERS.] (a) If a direct 
        appropriation from the general fund to the department for any 
        education aid or grant authorized in this chapter and chapters 
        122A, 123A, 123B, 124D, 125A, 126C, and 134, excluding 
        appropriations under sections 124D.135, 124D.16, 124D.20, 
        124D.21, 124D.22, 124D.52, 124D.53 124D.531, 124D.54, 124D.55, 
        and 124D.56, exceeds the amount required, the commissioner may 
        transfer the excess to any education aid or grant appropriation 
        that is insufficient.  However, section 126C.20 applies to a 
        deficiency in the direct appropriation for general education 
        aid.  Excess appropriations must be allocated proportionately 
        among aids or grants that have insufficient appropriations.  The 
        commissioner of finance shall make the necessary transfers among 
        appropriations according to the determinations of the 
        commissioner.  If the amount of the direct appropriation for the 
        aid or grant plus the amount transferred according to this 
        subdivision is insufficient, the commissioner shall prorate the 
        available amount among eligible districts.  The state is not 
        obligated for any additional amounts. 
           (b) Transfers for aids paid under section 127A.45, 
        subdivisions 12, paragraph (a), 12a, paragraph (a), and 13 shall 
        be made during the fiscal year after the fiscal year of the 
        entitlement.  Transfers for aids paid under section 127A.45, 
        subdivisions 11, 12, paragraph (b), and 12a, paragraph (b), 
        shall be made during the fiscal year of the appropriation. 
           Sec. 5.  Minnesota Statutes 2000, section 127A.42, is 
        amended to read: 
           127A.42 [REDUCTION OF AID FOR VIOLATION OF LAW.] 
           Subdivision 1.  [STATE AIDS.] The amount of special state 
        aids to which a district is entitled shall be the amount 
        computed according to statutes.  The annual state aid 
        certificate made by the commissioner to the commissioner of 
        finance shall show the amount of any reductions made. 
           Subd. 2.  [VIOLATIONS OF LAW.] The commissioner shall may 
        reduce or withhold the district's special state aid for any 
        school year whenever the board of the district authorizes or 
        permits violations of law within the district by: 
           (1) employing a teacher who does not hold a valid teaching 
        license or permit in a public school; 
           (2) noncompliance with a mandatory rule of general 
        application promulgated by the commissioner in accordance with 
        statute, unless special circumstances make enforcement 
        inequitable, impose an extraordinary hardship on the district, 
        or the rule is contrary to the district's best interests; 
           (3) the district's continued performance of a contract made 
        for the rental of rooms or buildings for school purposes or for 
        the rental of any facility owned or operated by or under the 
        direction of any private organization, if the contract has been 
        disapproved, the time for review of the determination of 
        disapproval has expired, and no proceeding for review is 
        pending; 
           (4) any practice which is a violation of sections 1 and 2 
        of article 13 of the Constitution of the state of Minnesota; 
           (5) failure to reasonably provide for a resident pupil's 
        school attendance under Minnesota Statutes; or 
           (6) noncompliance with state laws prohibiting 
        discrimination because of race, color, creed, religion, national 
        origin, sex, age, marital status, status with regard to public 
        assistance or disability, as defined in section 363.03; or 
           (7) using funds contrary to the statutory purpose of the 
        funds. 
        The reduction or withholding must be made in the amount and upon 
        the procedure provided in this section or, in the case of the 
        violation stated in clause (1), upon the procedure provided in 
        section 127A.43.  
           Subd. 3.  [ASSURANCE OF COMPLIANCE.] (a) After consultation 
        with the commissioner of human rights, the commissioner of 
        children, families, and learning shall adopt rules in 
        conformance with chapter 14.  The rules must direct districts to 
        file with the commissioner of children, families, and learning 
        assurances of compliance with state and federal laws prohibiting 
        discrimination.  The assurances must be provided in a form and 
        manner prescribed by the commissioner.  
           (b) If it appears that one or more violations of the 
        Minnesota Human Rights Act are occurring in a district, the 
        commissioner of human rights shall notify the commissioner of 
        the violations, and the commissioner of children, families, and 
        learning may then proceed pursuant to subdivision 4. 
           Subd. 4.  [NOTICE TO BOARD.] When it appears that an 
        enumerated a violation is occurring in a district, the 
        commissioner shall notify the board of that district in 
        writing.  The notice must specify the violations, set a 
        reasonable time within which the district must correct the 
        specified violations, describe the correction required, and 
        advise that if the correction is not made within the time 
        allowed, special state aids to the district will be reduced or 
        withheld.  The time allowed for correction may be extended by 
        the commissioner if there is reasonable ground therefor.  
           Subd. 5.  [DISPUTE VIOLATIONS; HEARING.] The board to which 
        such notice is given may, by a majority vote of the whole board, 
        decide to dispute that the specified violation exists or that 
        the time allowed is reasonable or the correction specified is 
        correct, or that the commissioner may reduce or withhold aids.  
        The board must give the commissioner written notice of the 
        decision.  If the commissioner, after further investigation as 
        the commissioner deems necessary, adheres to the previous 
        notice, the commissioner shall notify the school board of its 
        decision.  If the commissioner, after further investigation as 
        the commissioner deems necessary, adheres to the previous 
        notice, the board shall be entitled to a hearing by the 
        commissioner under this subdivision and notwithstanding chapter 
        14.  The commissioner must set a hearing time and place and the 
        board of the district must be given notice by mail.  The 
        hearings must be designed to give a full and fair hearing and 
        permit interested parties an opportunity to produce evidence 
        relating to the issues involved.  A stenographic record must be 
        made of all testimony given and other proceedings during the 
        hearing.  If practicable, rules governing admission of evidence 
        in courts shall apply to the hearing.  The final decision of the 
        commissioner must be in writing and the controlling facts upon 
        which the decision is made must be stated in sufficient detail 
        to apprise the parties and the reviewing court of the basis and 
        reason for the decision. The decision must be confined to 
        whether any of the specified violations existed at the date of 
        the commissioner's first notice, whether the violations were 
        corrected within the time permitted, whether the violations 
        require withholding or reduction of the state aids under this 
        section, and in what amount.  
           Subd. 6.  [VIOLATION; AID REDUCTION OR WITHHOLDING.] The 
        commissioner shall not reduce state aids payable to the district 
        if the violation specified is corrected within the time 
        permitted, or if the commissioner on being notified of the 
        district board's decision to dispute decides the violation does 
        not exist, or if the commissioner decides after hearing no 
        violation specified in the commissioner's notice existed at the 
        time of the notice, or that the violations were corrected within 
        the time permitted.  Otherwise state aids payable to the 
        district for the year in which the violation occurred shall may 
        be reduced or withheld as follows:  The total amount of state 
        aids to which the district may be entitled shall be reduced in 
        the proportion that the period during which a specified 
        violation continued, computed from the last day of the time 
        permitted for correction, bears to the total number of days 
        school is held in the district during the year in which a 
        violation exists, multiplied by up to 60 percent of the basic 
        revenue, as defined in section 126C.10, subdivision 2, of the 
        district for that year. 
           Subd. 7.  [REDUCTION IN AIDS PAYABLE.] Reductions in aid 
        under this section and sections 127A.41 and 127A.43 must be from 
        general education aid.  If there is not sufficient general 
        education aid remaining to be paid for the school year in which 
        the violation occurred, the reduction shall be from the other 
        aids listed in section 127A.44, subdivision 2, that are payable 
        to the district for that year in the order in which the aids are 
        listed in section 127A.44, subdivision 2.  If there is not a 
        sufficient amount of state aids remaining payable to the 
        district for the school year in which the violation occurred to 
        permit the full amount of reduction required, that part of the 
        required reduction not taken from that school year's aids will 
        be taken from the state aids payable to the district for the 
        next school year, and the reduction will be made from the 
        various aids payable for the next year in the order above 
        specified. 
           Subd. 8a.  [APPEAL.] A final decision of the commissioner 
        under this section may be appealed in accordance with section 
        480A.06, subdivision 3. 
           Subd. 9.  [NOTICE TO DISTRICT.] Any notice given to the 
        board of a district will be deemed given when a copy thereof is 
        mailed, registered, to the superintendent of the district, if 
        there is a superintendent, and to the clerk of the board of the 
        district.  If it is shown that neither the superintendent nor 
        the clerk in fact received such notice in the ordinary course of 
        mail, then the time for correction will be accordingly extended 
        by the commissioner so that a reasonable time will be allowed 
        from actual receipt of notice for correction.  If notice is sent 
        by the commissioner with respect to a violation which is 
        continued by the district in a succeeding year, no separate 
        notice for that violation for the succeeding year will be 
        required.  Proceedings initiated by such notice shall include 
        any continuing violation notwithstanding that a part thereof 
        occurs in a year different from the year in which it started.  
        The commissioner may require reasonable proof of the time that a 
        violation ceased for the determination of the amount of aids to 
        be reduced or withheld.  Costs and disbursements of the review 
        by the district court court of appeals, exclusive of those 
        incurred in the administrative proceedings, may be taxed against 
        the losing party and in the event taxed against the state must 
        be paid from the appropriations made to the department for the 
        payment of special state aids. 
           Sec. 6.  Minnesota Statutes 2000, section 127A.45, 
        subdivision 11, is amended to read: 
           Subd. 11.  [PAYMENT PERCENTAGE FOR REIMBURSEMENT AIDS.] One 
        hundred percent of the aid for the previous fiscal year must be 
        paid in the current year for the following aids:  special 
        education special pupil aid according to section 125A.75, 
        subdivision 3, for the previous fiscal year must be paid in the 
        current year aid for litigation costs according to section 
        125A.75, subdivision 8, aid for court-placed special education 
        expenses according to section 125A.79, subdivision 4, and aid 
        for special education out-of-state tuition according to section 
        125A.79, subdivision 8. 
           Sec. 7.  Minnesota Statutes 2000, section 127A.45, 
        subdivision 12, is amended to read: 
           Subd. 12.  [PAYMENT PERCENTAGE FOR CERTAIN AIDS.] (a) One 
        hundred percent of the aid for the current fiscal year must be 
        paid for the following aids:  reimbursement for enrollment 
        options transportation to post-secondary institutions, according 
        to section sections 124D.03, subdivision 8, 124D.09, subdivision 
        22, and 124D.10; aid for the program for adults with 
        disabilities, according to section 124D.56, subdivision 2; 
        school lunch aid, according to section 124D.111; hearing 
        impaired support services aid, according to section 124D.57; and 
        Indian post-secondary preparation grants according to section 
        124D.85; integration grants according to Laws 1989, chapter 329, 
        article 8, section 14, subdivision 3; and debt service aid 
        according to section 123B.53, subdivision 6. 
           (b) One hundred percent of the aid for the current fiscal 
        year, based on enrollment in the previous year, must be paid for 
        the first grade preparedness program according to section 
        124D.081. 
           Sec. 8.  Minnesota Statutes 2000, section 127A.45, is 
        amended by adding a subdivision to read: 
           Subd. 14a.  [STATE NUTRITION PROGRAMS.] Notwithstanding 
        subdivision 3, the state shall pay 100 percent of the aid for 
        the current year according to sections 124D.111, 124D.115, and 
        124D.118 and 90 percent of the aid for the current year 
        according to section 124D.1156 based on submitted monthly 
        vouchers showing meals and milk served.  The remaining ten 
        percent according to section 124D.1156 shall be paid by October 
        30 of the following fiscal year. 
           Sec. 9.  Minnesota Statutes 2000, section 475.61, 
        subdivision 3, is amended to read: 
           Subd. 3.  [IRREVOCABILITY.] (a) Tax levies so made and 
        filed shall be irrevocable, except as provided in this 
        subdivision. 
           (b) For purposes of this subdivision, "excess debt 
        redemption fund balance" means the greater of zero or the 
        balance in the district's debt redemption fund as of June 30 of 
        the fiscal year ending in the year before the year the levy is 
        certified, minus any debt redemption fund balance attributable 
        to refunding of existing bonds, minus the amount of the levy 
        reduction for the current year and the prior year under 
        paragraphs (e) and (f), minus five percent of the district's 
        required debt service levy for the next year. 
           (c) By July 15 each year, a district shall report to the 
        commissioner of children, families, and learning the amount of 
        the districts' debt redemption fund balance as of June 30 of the 
        prior year attributable to refunding of existing bonds.  
           (d) By August 15 each year, the commissioner shall 
        determine the excess debt redemption fund balance for each 
        school district, and shall certify the amount of the excess 
        balance to the school district superintendent.  
           (e) In each year when there is on hand any a district has 
        an excess amount in the debt redemption fund of a school 
        district at the time the district makes its property tax levies, 
        the amount of the excess shall be certified by the school board 
        to the commissioner. balance, the commissioner shall report the 
        amount of the excess to the county auditor and the auditor shall 
        reduce the tax levy otherwise to be included in the rolls next 
        prepared by the amount certified.  The commissioner shall 
        prescribe the form and calculation to be used in computing the 
        excess amount.  
           (f) The school board may, with the approval of the 
        commissioner, retain all or part of the excess amount balance if 
        it is necessary to ensure the prompt and full payment of the its 
        obligations and any call premium on the its obligations, or will 
        be used for redemption of the its obligations in accordance with 
        their terms, or to level out the debt service tax rate, 
        excluding the debt excess adjustment, for its obligations over 
        the next two years.  A school district requesting authority to 
        retain all or part of the excess balance shall provide written 
        documentation to the commissioner describing the rationale for 
        its request by September 15 including the issuance of new 
        obligations within the next year or the refunding of existing 
        obligations.  A school district that retains an excess may 
        request to transfer the excess to its operating capital account 
        in the general fund under section 123B.80.  The school board 
        may, with the approval of the commissioner, specify a tax levy 
        in a higher amount if necessary because of anticipated tax 
        delinquency or for cash flow needs to meet the required payments 
        from the debt redemption fund.  
           (g) If the governing body, including the governing body of 
        a school district, in any year makes an irrevocable 
        appropriation to the debt service fund of money actually on hand 
        or if there is on hand any excess amount in the debt service 
        fund, the recording officer may certify to the county auditor 
        the fact and amount thereof and the auditor shall reduce by the 
        amount so certified the amount otherwise to be included in the 
        rolls next thereafter prepared. 
           Sec. 10.  [FUND TRANSFERS.] 
           Subdivision 1.  [LAPORTE.] Notwithstanding Minnesota 
        Statutes, section 123B.79 or 123B.80, on June 30, 2001, 
        independent school district No. 306, LaPorte, may permanently 
        transfer up to $141,000 from the bus purchase account in its 
        transportation fund to its capital expenditure fund without 
        making a levy reduction. 
           Subd. 2.  [LAC QUI PARLE VALLEY.] Notwithstanding Minnesota 
        Statutes, sections 123B.58, 123B.79, or 123B.80, on June 30, 
        2001, independent school district No. 2853, Lac qui Parle 
        Valley, may permanently transfer up to $250,000 from its 
        reserved account for disabled accessibility to its reserved 
        account for operating capital in the general fund.  This 
        transfer is contingent upon the school district demonstrating to 
        the commissioner's satisfaction that the district's school 
        buildings are accessible to students or employees with 
        disabilities. 
           Subd. 3.  [CLEVELAND.] Notwithstanding Minnesota Statutes, 
        section 123B.79 or 123B.80, on June 30, 2001, independent school 
        district No. 391, Cleveland, may permanently transfer up to 
        $107,000 from its reserved operating capital account in its 
        general fund to the undesignated fund balance. 
           Subd. 4.  [LEWISTON.] (a) Notwithstanding Minnesota 
        Statutes, section 123B.79 or 123B.80, for calendar years 2002 
        through 2012, on June 30 of each year, independent school 
        district No. 857, Lewiston, may permanently transfer up to 
        $175,000 from its capital accounts in its general fund or from 
        its unrestricted general fund to the debt redemption fund. 
           (b) The eligible debt service revenue and debt service 
        equalization aid, if any, for independent school district No. 
        857, Lewiston, must be determined prior to the annual transfer 
        of general fund revenue authorized in subdivision 1. 
           Subd. 5.  [RUSSELL.] Notwithstanding Minnesota Statutes, 
        section 123B.79 or 123B.80, on June 30, 2001, independent school 
        district No. 418, Russell, may permanently transfer up to 
        $160,000 from its reserved operating capital account in its 
        general fund to the undesignated fund balance. 
           Subd. 6.  [MOUNTAIN LAKE.] Notwithstanding Minnesota 
        Statutes, section 123B.79 or 123B.80, on June 30, 2001, 
        independent school district No. 173, Mountain Lake, may 
        permanently transfer up to $300,000 from its reserved capital 
        accounts in its general fund to the undesignated fund balance. 
           Subd. 7.  [ISLE.] (a) Notwithstanding Minnesota Statutes, 
        section 123B.79 or 123B.80, on June 30, 2001, upon approval of 
        the commissioner of children, families, and learning, 
        independent school district No. 473, Isle, may permanently 
        transfer up to $175,000 from its reserved account for disability 
        access to its undesignated general fund balance.  
           (b) Prior to making the fund transfer, independent school 
        district No. 473, Isle, must demonstrate to the commissioner's 
        satisfaction that the district's school buildings are accessible 
        to students or employees with disabilities.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment.  
           Sec. 11.  [OPERATING CAPITAL ACCOUNT DEFICIT; EXCEPTION.] 
           Notwithstanding Minnesota Statutes, section 123B.78, 
        subdivision 5, the commissioner of children, families, and 
        learning may allow independent school district No. 492, Austin, 
        to incur a deficit of up to $4,200,000 in its reserve for 
        capital operating account for the Westcott Field improvement 
        project.  The deficit must be eliminated by June 30, 2011.  Any 
        donations or contributions received by the district for the 
        Westcott Field improvement project must be deposited in the 
        reserve for capital operating account to repay the deficit.  The 
        commissioner of children, families, and learning must certify 
        the financial viability of the Westcott Field improvement 
        project prior to approving authority under this section. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 12.  [SCHOOL DISTRICT FORMULA ADJUSTMENTS.] 
           Subdivision 1.  [TAX RATE ADJUSTMENT.] The commissioner of 
        children, families, and learning must adjust each tax rate 
        established under Minnesota Statutes, chapters 120A to 127A, by 
        multiplying the rate by the ratio of the statewide net tax 
        capacity as calculated using the class rates in effect for 
        assessment year 2000 to the statewide total net tax capacity as 
        calculated using the class rates in effect for assessment year 
        2001, in both cases using taxable market values for assessment 
        year 2000. 
           Subd. 2.  [EQUALIZING FACTORS.] The commissioner of 
        children, families, and learning must adjust each equalizing 
        factor based upon adjusted net tax capacity per actual pupil 
        unit established under Minnesota Statutes, chapters 120A to 
        127A, by multiplying the equalizing factor by the ratio of the 
        statewide net tax capacity as calculated using the class rates 
        in effect for assessment year 2001 to the statewide total net 
        tax capacity as calculated using the class rates in effect for 
        assessment year 2000, in both cases using taxable market values 
        for assessment year 2000. 
           Subd. 3.  [DEBT SERVICE TAX RATES AND EQUALIZING 
        FACTORS.] The provisions in subdivisions 1 and 2 do not apply to 
        the equalizing factors and tax rates of the debt service 
        equalization aid program under Minnesota Statutes, section 
        123B.53. 
           [EFFECTIVE DATE.] This section is effective for aid and 
        levy calculations for fiscal year 2003 and subsequent years. 
           Sec. 13.  [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.  [SCHOOL LUNCH.] (a) For school lunch aid 
        according to Minnesota Statutes, section 124D.111, and Code of 
        Federal Regulations, title 7, section 210.17, and for school 
        milk aid according to Minnesota Statutes, section 124D.118:  
             $8,710,000     .....     2002 
             $8,950,000     .....     2003 
           (b) Not more than $800,000 of the amount appropriated each 
        year may be used for school milk aid. 
           Subd. 3.  [SCHOOL BREAKFAST.] For school breakfast aid 
        under Minnesota Statutes, section 124D.115: 
             $640,000       .....     2002 
             $700,000       .....     2003 
           Subd. 4.  [SUMMER FOOD SERVICE REPLACEMENT AID.] For summer 
        food service replacement aid under Minnesota Statutes, section 
        124D.119: 
             $150,000       .....     2002 
             $150,000       .....     2003 
           Subd. 5.  [FAST BREAK TO LEARNING GRANTS.] For fast break 
        to learning grants under Minnesota Statutes, section 124D.1156: 
             $2,446,000     .....     2002 
             $2,839,000     .....     2003 
           The 2002 appropriation includes $0 for 2001 and $2,446,000 
        for 2002. 
           The 2003 appropriation includes $272,000 for 2002 and 
        $2,567,000 for 2003. 
           Sec. 14.  [REPEALER.] 
           Minnesota Statutes 2000, section 124D.1155, is repealed. 

                                   ARTICLE 6
                                  DEFICIENCIES
           Section 1.  [APPROPRIATIONS; DEFICIENCIES.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] Unless otherwise indicated, 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 for the funding of programs subject to 
        state-aid deficiencies in fiscal year 2001.  These 
        appropriations are in addition to any other appropriations for 
        those purposes. 
           Subd. 2.  [GENERAL EDUCATION AID.] For general education 
        aid: 
             $19,754,000    .....     2001 
           Subd. 3.  [SECONDARY VOCATIONAL AID.] For secondary 
        vocational aid: 
             $    6,000     .....     2001 
           Subd. 4.  [SPECIAL EDUCATION EXCESS COST AID.] For special 
        education excess cost aid: 
             $6,740,000     .....     2001 
           Subd. 5.  [HEALTH AND SAFETY AID.] For health and safety 
        aid: 
             $  273,000     .....     2001 
           Subd. 6.  [INTERACTIVE TELEVISION AID.] For interactive 
        television aid: 
             $    6,000     .....     2001 
           Subd. 7.  [ALTERNATIVE FACILITIES BONDING AID.] For 
        alternative facilities bonding aid: 
             $   68,000     .....     2001 

                                   ARTICLE 7 
                                 STATE AGENCIES 
           Section 1.  Minnesota Statutes 2000, section 122A.162, is 
        amended to read: 
           122A.162 [LICENSURE RULES.] 
           The commissioner may make rules relating to licensure of 
        school personnel not licensed by the board of teaching or board 
        of school administrators. 
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001. 
           Sec. 2.  Minnesota Statutes 2000, section 122A.163, is 
        amended to read: 
           122A.163 [TEACHER RULE VARIANCES; COMMISSIONER.] 
           Notwithstanding any law to the contrary, and only upon 
        receiving the agreement of the state board of teaching or board 
        of school administrators, whichever has jurisdiction over the 
        licensure, the commissioner of children, families, and learning 
        may grant a variance to rules governing licensure of teachers 
        for those teachers persons licensed by the board of teaching or 
        board of school administrators, whichever has jurisdiction.  The 
        commissioner may grant a variance, without the agreement of the 
        board of teaching, to rules adopted by the commissioner 
        governing licensure of teachers for those teachers the 
        commissioner licenses. 
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001. 
           Sec. 3.  Minnesota Statutes 2000, section 122A.18, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [AUTHORITY TO LICENSE.] (a) The board of 
        teaching must license teachers, as defined in section 122A.15, 
        subdivision 1, except for supervisory personnel, as defined in 
        section 122A.15, subdivision 2. 
           (b) The commissioner of children, families, and learning 
        board of school administrators must license supervisory 
        personnel as defined in section 122A.15, subdivision 2, except 
        for athletic coaches.  
           (c) Licenses under the jurisdiction of the board of 
        teaching, the board of school administrators, and the 
        commissioner of children, families, and learning must be issued 
        through the licensing section of the department.  
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001. 
           Sec. 4.  Minnesota Statutes 2000, section 122A.18, 
        subdivision 4, is amended to read: 
           Subd. 4.  [EXPIRATION AND RENEWAL.] (a) Each license the 
        department of children, families, and learning issues through 
        its licensing section must bear the date of issue.  Licenses 
        must expire and be renewed according to the respective rules the 
        board of teaching, the board of school administrators, or the 
        commissioner of children, families, and learning adopts.  
        Requirements for renewing a license must include showing 
        satisfactory evidence of successful teaching or administrative 
        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 completing such additional preparation as 
        the board of teaching prescribes.  The commissioner of children, 
        families, and learning board of school administrators shall 
        establish requirements for renewing the licenses of supervisory 
        personnel except athletic coaches.  The state board of teaching 
        shall establish requirements for renewing the licenses of 
        athletic coaches. 
           (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.  
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001. 
           Sec. 5.  [122A.191] [DEFINITIONS.] 
           Subdivision 1.  [SCOPE.] For the purposes of sections 
        122A.191 to 122A.193, the terms in this section have the 
        meanings given them, unless another meaning is clearly indicated.
           Subd. 2.  [BOARD.] "Board" means board of school 
        administrators. 
           Subd. 3.  [SUPERVISORY PERSONNEL.] "Supervisory personnel" 
        means supervisory personnel as defined in section 122A.15, 
        subdivision 2, excluding athletic coaches. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 6.  [122A.192] [BOARD OF SCHOOL ADMINISTRATORS.] 
           Subdivision 1.  [MEMBERSHIP.] A board of school 
        administrators is established and must consist of nine members 
        appointed by the governor with the advice and consent of the 
        senate, including at least: 
           (1) one elementary school principal; 
           (2) one secondary school principal; 
           (3) one higher education faculty member in an educational 
        administration program approved by the board; 
           (4) one higher education administrator for an educational 
        administration program approved by the board; 
           (5) one school superintendent; 
           (6) one classroom teacher; 
           (7) one community education director or a special education 
        director; and 
           (8) two members of the public, one of whom must be a 
        present or former school board member. 
           In making appointments, the governor shall solicit 
        recommendations from groups representing persons in clauses (1) 
        to (8). 
           Subd. 2.  [TERMS; COMPENSATION; REMOVAL; 
        ADMINISTRATION.] Membership terms, removal of members, and the 
        filling of membership vacancies are as provided in section 
        214.09.  The terms of the initial board members must be 
        determined by lot as follows: 
           (1) three members must be appointed for terms that expire 
        August 1, 2002; 
           (2) three members must be appointed for terms that expire 
        August 1, 2003; and 
           (3) three members must be appointed for terms that expire 
        August 1, 2004. 
           Members shall not receive the daily payment under section 
        214.09, subdivision 3.  The public employer of a member shall 
        not reduce the member's compensation or benefits for the 
        member's absence from employment when engaging in the business 
        of the board.  The provision of staff, administrative services, 
        and office space; the review and processing of complaints; the 
        setting of fees; the selection and duties of an executive 
        secretary to serve the board; and other provisions relating to 
        board operations are as provided in chapter 214.  Fiscal year 
        and reporting requirements are as provided in sections 214.07 
        and 214.08. 
           Subd. 3.  [VACANT POSITION.] The position of a member who 
        leaves Minnesota or whose employment status changes to a 
        category different from that from which appointed shall be 
        deemed vacant.  
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 7.  [122A.193] [MEETINGS.] 
           Subdivision 1.  [MEETINGS.] The board of school 
        administrators shall meet regularly at the times and places 
        determined by the board.  The board shall nominate and elect a 
        chair and other officers from its membership.  Meetings shall be 
        called by the chair or at the written request of any three 
        members.  
           Subd. 2.  [EXECUTIVE SECRETARY.] The board of school 
        administrators may hire an executive secretary and other staff 
        or may arrange to share an executive secretary and staff with 
        the board of teaching.  If the board hires an executive 
        secretary, the person is in the unclassified service. 
           [EFFECTIVE DATE.] This section is effective the day 
        following final enactment. 
           Sec. 8.  [122A.194] [DUTIES OF BOARD OF SCHOOL 
        ADMINISTRATORS.] 
           Subdivision 1.  [LICENSING.] The board shall license school 
        administrators.  The board shall adopt rules to license school 
        administrators under chapter 14.  Other than the rules 
        transferred to the board under section 122A.18, subdivision 4, 
        the board may not adopt or amend rules under this section until 
        the rules are approved by law.  The rules shall include the 
        licensing of persons who have successfully completed alternative 
        preparation programs under section 122A.27 or other alternative 
        competency-based preparation programs.  The board may enter into 
        agreements with the board of teaching regarding multiple license 
        matters.  
           Subd. 2.  [PREPARATION PROGRAMS.] The board shall review 
        and approve preparation programs for school administrators and 
        alternative preparation programs for administrators under 
        section 122A.27, and must consider other alternative 
        competency-based preparation programs leading to licensure.  
           Subd. 3.  [RULES FOR CONTINUING EDUCATION REQUIREMENTS.] 
        The board shall adopt rules establishing continuing education 
        requirements that promote continuous improvement and acquisition 
        of new and relevant skills by school administrators. 
           Subd. 4.  [CODE OF ETHICS.] The board shall adopt by rule a 
        code of ethics covering standards of professional practice, 
        including ethical conduct, professional performance, and methods 
        of enforcement, and advise school administrators in interpreting 
        the code of ethics. 
           Subd. 5.  [COMMISSIONER'S REPRESENTATIVE TO COMMENT ON 
        PROPOSED RULE.] Before adopting any rule that must be submitted 
        to public hearing, a representative of the commissioner of 
        children, families, and learning shall appear before the board 
        and at any hearing required under section 14.14, subdivision 1, 
        to comment on the cost and educational implications of the 
        proposed rule.  
           Subd. 6.  [REGISTER OF PERSONS LICENSED.] The executive 
        director of the board shall keep a record of board proceedings 
        and a register of all persons licensed under this chapter.  The 
        register must show the name, address, license number, and the 
        renewal of the license.  The board must on July 1 of each year, 
        or as soon thereafter as is practicable, compile a list of 
        licensed school administrators and transmit a copy of the list 
        to the board.  A copy of the register must be available during 
        business hours at the office of the board to any interested 
        person.  
           Subd. 7.  [COMMISSIONER'S ASSISTANCE; BOARD MONEY.] The 
        commissioner shall provide all necessary materials and 
        assistance for transacting board business and all money received 
        by the board shall be paid into the state treasury as provided 
        by law.  The expenses of administering the board of school 
        administrators shall be paid for from appropriations made to the 
        board of school administrators. 
           Subd. 8.  [ACCOUNTABILITY.] The board must develop 
        accountability measures for programs preparing students for 
        licensure and report the progress of the programs to the 
        legislature by January 15 of every other year beginning with the 
        2003 legislature. 
           Subd. 9.  [ANNUAL FEE.] Each person licensed by the board 
        of school administrators shall pay the board an annual fee of 
        $75.  The board may provide a lower fee for persons on retired 
        or inactive status.  The executive secretary shall deposit the 
        fees in the state treasury. 
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001, except that the fee imposed by subdivision 9 is effective 
        July 1, 2001. 
           Sec. 9.  Minnesota Statutes 2000, section 122A.20, 
        subdivision 2, is amended to read: 
           Subd. 2.  [MANDATORY REPORTING.] A school board must report 
        to the board of teaching, the board of school administrators, or 
        the board of trustees of the Minnesota state colleges and 
        universities, whichever has jurisdiction over the teacher's or 
        administrator's license, when its teacher or administrator is 
        discharged or resigns from employment after a charge is filed 
        with the school board under section 122A.41, subdivisions 6, 
        clauses (1), (2), and (3), and 7, or after charges are filed 
        that are ground for discharge under section 122A.40, subdivision 
        13, paragraph (a), clauses (1) to (5), or when a teacher or 
        administrator is suspended or resigns while an investigation is 
        pending under section 122A.40, subdivision 13, paragraph (a) 
        clauses (1) to (5); 122A.41, subdivisions 6, clauses (1), (2), 
        and (3), and 7; or 626.556.  The report must be made to the 
        appropriate licensing board within ten days after the discharge, 
        suspension, or resignation has occurred.  The licensing board to 
        which the report is made must investigate the report for 
        violation of subdivision 1 and the reporting board must 
        cooperate in the investigation.  Notwithstanding any provision 
        in chapter 13 or any law to the contrary, upon written request 
        from the licensing board having jurisdiction over the teacher's 
        license, a board or school superintendent shall provide the 
        licensing board with information about the teacher or 
        administrator from the district's files, any termination or 
        disciplinary proceeding, any settlement or compromise, or any 
        investigative file.  Upon written request from the appropriate 
        licensing board, a board or school superintendent may, at the 
        discretion of the board or school superintendent, solicit the 
        written consent of a student and the student's parent to provide 
        the licensing board with information that may aid the licensing 
        board in its investigation and license proceedings.  The 
        licensing board's request need not identify a student or parent 
        by name.  The consent of the student and the student's parent 
        must meet the requirements of chapter 13 and Code of Federal 
        Regulations, title 34, section 99.30.  The licensing board may 
        provide a consent form to the district.  Any data transmitted to 
        any board under this section is private data under section 
        13.02, subdivision 12, notwithstanding any other classification 
        of the data when it was in the possession of any other agency. 
           The licensing board to which a report is made must transmit 
        to the attorney general's office any record or data it receives 
        under this subdivision for the sole purpose of having the 
        attorney general's office assist that board in its 
        investigation.  When the attorney general's office has informed 
        an employee of the appropriate licensing board in writing that 
        grounds exist to suspend or revoke a teacher's license to teach, 
        that licensing board must consider suspending or revoking or 
        decline to suspend or revoke the teacher's or administrator's 
        license within 45 days of receiving a stipulation executed by 
        the teacher or administrator under investigation or a 
        recommendation from an administrative law judge that 
        disciplinary action be taken. 
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001. 
           Sec. 10.  Minnesota Statutes 2000, section 122A.21, is 
        amended to read: 
           122A.21 [TEACHERS' AND ADMINISTRATORS' LICENSES; FEES.] 
           Each application for the issuance, renewal, or extension of 
        a license to teach and each application for the issuance, 
        renewal, or extension of a license as supervisory personnel must 
        be accompanied by a processing fee in an amount set by the board 
        of teaching by rule.  Each application for issuing, renewing, or 
        extending the license of a school administrator or supervisor 
        must be accompanied by a processing fee in the amount set by the 
        board of teaching.  The processing fee for a teacher's license 
        and for the licenses of supervisory personnel must be paid to 
        the executive secretary of the appropriate board of teaching.  
        The executive secretary of the board of teaching shall deposit 
        the fees with the state treasurer, as provided by law, and 
        report each month to the commissioner of finance the amount of 
        fees collected.  The fees as set by the board are nonrefundable 
        for applicants not qualifying for a license.  However, a fee 
        must be refunded by the state treasurer in any case in which the 
        applicant already holds a valid unexpired license.  The board 
        may waive or reduce fees for applicants who apply at the same 
        time for more than one license. 
           [EFFECTIVE DATE.] This section is effective September 1, 
        2001. 
           Sec. 11.  [CONTRACTS AND GRANTS UNIT; INTERNAL AUDITS 
        OFFICE.] 
           (a) The commissioner of children, families, and learning 
        shall establish a contracts and grants unit within the 
        department to manage the contracting process for the 
        department.  The unit must be separate from individual program 
        functions.  The duties of the unit include: 
           (1) supporting the fiscal management of contracts and 
        grants; 
           (2) technical assistance to program areas in setting up and 
        monitoring grants; 
           (3) legal review of contracts for compliance with state law 
        and requirements of private grants; 
           (4) training and advising program areas on how the 
        contracting process should be handled; 
           (5) reviewing requests for proposals for compliance with 
        legal requirements; 
           (6) drafting and maintaining a contracts manual for use by 
        program areas; and 
           (7) approving all contracts entered into by program areas. 
           (b) The commissioner of children, families, and learning 
        shall establish an internal audits office.  Any significant 
        audit violations must be reported to the commissioner in 
        writing.  The office must report at least annually to the 
        commissioner on contract policies, procedures, and controls.  
        Duties of the internal audits office include: 
           (1) serving as an independent appraisal function to examine 
        and evaluate the department's activities; 
           (2) measuring and evaluating the effectiveness of 
        accounting, financial and operating policies, procedures, and 
        controls on a department basis; and 
           (3) examining contracts and grants for compliance with 
        federal and state law. 
           Sec. 12.  [RETROACTIVITY.] 
           A contract encumbered or a grant awarded by the department 
        of children, families, and learning for the Perpich Center for 
        Arts Education or the Minnesota state academies before September 
        1, 2001, may be made retroactive to July 1, 2001. 
           Sec. 13.  [APPROPRIATIONS; DEPARTMENT OF CHILDREN, 
        FAMILIES, AND LEARNING.] 
           Subdivision 1.  [DEPARTMENT OF CHILDREN, FAMILIES, AND 
        LEARNING.] Unless otherwise indicated, 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.] (a) For the department of children, 
        families, and learning: 
             $31,530,000    .....     2002
             $31,748,000    .....     2003 
           Any balance in the first year does not cancel but is 
        available in the second year. 
           (b) $684,000 in 2002 and $690,000 in 2003 are for the board 
        of teaching. 
           (c) $165,000 each year is for the board of school 
        administrators. 
           (d) $400,000 in fiscal year 2002 and $400,000 in fiscal 
        year 2003 are for the office of educational accountability under 
        Minnesota Statutes, section 120B.31, subdivision 3. 
           (e) $500,000 in 2002 and $250,000 in 2003 and thereafter 
        are for the Minnesota Academic Excellence Foundation.  
           (f) $260,000 each year is for the Minnesota Children's 
        Museum; $50,000 in fiscal year 2002 is for the Duluth Children's 
        Museum. 
           (g) The expenditures of federal grants and aids as shown in 
        the biennial budget document and its supplements are approved 
        and appropriated and shall be spent as indicated. 
           (h) In preparing the department budget for fiscal years 
        2004-2005, the department shall shift all administrative funding 
        from aids appropriations into the appropriation for the 
        department.  
           Sec. 14.  [APPROPRIATIONS; PERPICH CENTER FOR ARTS 
        EDUCATION.] 
           The sums indicated in this section are appropriated from 
        the general fund to the Perpich Center for Arts Education for 
        the fiscal years designated: 
             $7,681,000     .....     2002 
             $7,816,000     .....     2003 
           $150,000 each year is to extend the partnership network to 
        up to five new partnership sites and for developing 
        whole-school, arts-based teaching and learning curriculum at new 
        sites.  
           Any balance in the first year does not cancel but is 
        available in the second year. 
           Sec. 15.  [APPROPRIATIONS; MINNESOTA STATE ACADEMIES.] 
           The sums indicated in this section are appropriated from 
        the general fund to the Minnesota state academies for the deaf 
        and the blind for the fiscal years designated:  
             $10,761,000    .....     2002 
             $10,966,000    .....     2003 
           Any balance in the first year does not cancel but is 
        available in the second year. 

                                   ARTICLE 8 
                              TECHNICAL AMENDMENTS 
           Section 1.  Minnesota Statutes 2000, section 122A.26, 
        subdivision 3, is amended to read: 
           Subd. 3.  [ENGLISH AS A SECOND LANGUAGE.] Notwithstanding 
        subdivision 2, a person who possesses a bachelor's or master's 
        degree in English as a second language, applied linguistics, or 
        bilingual education, or who possesses a related degree as 
        approved by the commissioner, shall be permitted to teach 
        English as a second language in an adult basic education program 
        that receives funding under section 124D.53 124D.531.  
           Sec. 2.  Minnesota Statutes 2000, section 124D.11, 
        subdivision 5, is amended to read: 
           Subd. 5.  [SPECIAL EDUCATION AID.] Except as provided in 
        subdivision 2, special education aid must be paid to a charter 
        school according to section 125A.76, as though it were a school 
        district.  The charter school may charge tuition to the district 
        of residence as provided in section 125A.11.  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 
        125A.77, subdivision 3. 
           Sec. 3.  Minnesota Statutes 2000, section 124D.454, 
        subdivision 11, is amended to read: 
           Subd. 11.  [REVENUE ALLOCATION FROM COOPERATIVE CENTERS AND 
        INTERMEDIATE DISTRICTS.] For purposes of this section and 
        section 125A.77, a cooperative center or an intermediate 
        district must allocate its approved expenditures for transition 
        programs for children with a disability among participating 
        school districts.  Aid for transition programs for children with 
        a disability for services provided by a cooperative or 
        intermediate district shall be paid to the participating 
        districts.  
           Sec. 4.  Minnesota Statutes 2000, section 125A.17, is 
        amended to read: 
           125A.17 [LEGAL RESIDENCE OF A CHILD WITH A DISABILITY 
        PLACED IN A FOSTER FACILITY.] 
           The legal residence of a child with a disability placed in 
        a foster facility for care and treatment is the district in 
        which the child resides when: 
           (1) parental rights have been terminated by court order; 
           (2) the parent or guardian is not living within the state; 
           (3) no other district residence can be established; or 
           (4) the parent or guardian having legal custody of the 
        child is an inmate of a Minnesota correctional facility or is a 
        resident of a halfway house under the supervision of the 
        commissioner of corrections; 
        is the district in which the child resides.  The school board of 
        the district of residence must provide the same educational 
        program for the child as it provides for all resident children 
        with a disability in the district.  
           Sec. 5.  Minnesota Statutes 2000, section 127A.41, 
        subdivision 9, is amended to read: 
           Subd. 9.  [APPROPRIATION TRANSFERS FOR COMMUNITY EDUCATION 
        PROGRAMS.] If a direct appropriation from the general fund to 
        the department of children, families, and learning for an 
        education aid or grant authorized under section 124D.135, 
        124D.16, 124D.20, 124D.21, 124D.22, 124D.52, 124D.53 124D.531, 
        124D.54, 124D.55, or 124D.56 exceeds the amount required, the 
        commissioner of children, families, and learning may transfer 
        the excess to any education aid or grant appropriation that is 
        insufficiently funded under these sections.  Excess 
        appropriations shall be allocated proportionately among aids or 
        grants that have insufficient appropriations.  The commissioner 
        of finance shall make the necessary transfers among 
        appropriations according to the determinations of the 
        commissioner of children, families, and learning.  If the amount 
        of the direct appropriation for the aid or grant plus the amount 
        transferred according to this subdivision is insufficient, the 
        commissioner shall prorate the available amount among eligible 
        districts.  The state is not obligated for any additional 
        amounts. 
           Sec. 6.  [REPEALER.] 
           Laws 2000, chapter 254, section 30; and Laws 2000, chapter 
        489, article 1, section 18, are repealed. 
           Sec. 7.  [GENERAL EFFECTIVE DATE OF ACT.] 
           If a section in this act does not specify its effective 
        date, the section is effective July 1, 2001, unless the language 
        or context clearly indicates that a different effective date is 
        intended. 
           Presented to the governor June 30, 2001 
           Signed by the governor June 30, 2001, 8:41 p.m.

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