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1988 Minnesota Session Laws

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                         Laws of Minnesota 1988 

                        CHAPTER 718-H.F.No. 2245 
           An act relating to education; establishing general 
          education revenue; modifying aspects of educational 
          programs for American Indian people; providing for 
          certain levying authority and limitations; modifying 
          certain levies, aid, and grant programs; establishing 
          learning year program sites; providing for revenue for 
          school facilities; authorizing bonding; approving 
          capital loans; offering free admission to secondary 
          school to eligible persons at least 21 years of age; 
          creating education district revenue; providing for the 
          sale of permanent school fund lands; requiring certain 
          changes in the state high school league; creating a 
          task force on education organization; appropriating 
          money; amending Minnesota Statutes 1986, sections 
          92.06, subdivision 4; 92.14, by adding a subdivision; 
          92.67, subdivision 5; 120.06, by adding a subdivision; 
          120.075, subdivision 1a, 3, and by adding a 
          subdivision; 120.0751, subdivision 1, and by adding a 
          subdivision; 120.0752, subdivision 1, and by adding a 
          subdivision; 120.08, subdivision 2; 120.73, 
          subdivision 1; 120.74, subdivision 1; 121.15; 121.88, 
          by adding subdivisions; 123.35, subdivision 8; 
          123.351, by adding a subdivision; 123.3514, by adding 
          a subdivision; 124.17, by adding a subdivision; 
          124.18, subdivision 2; 124.214, subdivision 2; 
          124.225, by adding a subdivision; 124.245, by adding a 
          subdivision; 124.43, subdivisions 1, 2, 3, and by 
          adding subdivisions; 124.48, subdivision 2; 124A.036, 
          subdivision 2; 125.12, subdivision 3; 125.17, 
          subdivision 2; 126.151; 126.45; 126.46; 126.47; 
          126.49, subdivision 1; 126.51, subdivisions 1, 2, 4, 
          and by adding a subdivision;  126.52; 126.531; 126.56; 
          subdivision 2; 129.121, subdivision 2, and by adding 
          subdivisions; 129B.20, subdivision 1; 134.351, 
          subdivision 7; 136D.74, by adding subdivisions; 
          136D.81; 260.015, subdivision 19; and 275.125, by 
          adding subdivisions; Minnesota Statutes 1987 
          Supplement, sections 92.46, subdivision 1; 92.67, 
          subdivisions 1, 3, and 4; 120.0752, subdivision 3; 
          120.101, subdivisions 5 and 9; 120.17, subdivisions 1 
          and 3b; 121.912, subdivision 1; 122.91, by adding a 
          subdivision; 123.3515, subdivisions 1, 2, 3, 5, 6, and 
          9; 123.39, subdivision 1; 124.17, subdivision 1; 
          124.214, subdivision 3; 124.223; 124.225, subdivision 
          8a; 124.244; 124.26, subdivision 1b; 124.494, 
          subdivisions 4, 5, and 6; 124.495; 124A.036, 
          subdivision 5; 124A.22, subdivision 2, and by adding 
          subdivisions; 124A.23, subdivisions 1, 4, and 5; 
          124A.24; 124A.27, subdivision 1; 124A.28, subdivision 
          1, and by adding a subdivision; 126.22, subdivisions 
          2, 3, 4, and by adding a subdivision; 126.23; 126.67, 
          subdivision 2b; 129.121, subdivision 1; 129B.11, 
          subdivision 2, and by adding a subdivision; 129B.53, 
          subdivision 2; 136D.27; 136D.87; 275.125, subdivision 
          5; and 422A.101, subdivision 2; Laws 1959, chapter 
          462, section 3, subdivision 4, as amended; Laws 1987, 
          chapter 398, articles 2, section 13, subdivision 2; 3, 
          sections 38 and 39, subdivisions 7 and 8; 5, section 
          2, subdivision 12; chapter 400, section 59; proposing 
          coding for new law in Minnesota Statutes, chapters 
          120; 121; 124; 124A; 126; and 129B; repealing 
          Minnesota Statutes 1986, sections 121.9121, 
          subdivision 7; 124.435; 126.51, subdivision 3; 
          Minnesota Statutes 1987 Supplement, sections 123.3515; 
          123.703, subdivision 3; 124.245, subdivisions 3, 3a, 
          and 3b; 124A.27, subdivision 10; 129B.74; 129B.75; and 
          275.125, subdivision 11c; Laws 1984, chapter 463, 
          article 7, section 45. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1 

                       GENERAL EDUCATION REVENUE 
    Section 1.  Minnesota Statutes 1987 Supplement, section 
124A.22, subdivision 2, is amended to read:  
    Subd. 2.  [BASIC REVENUE.] The basic revenue for each 
district equals the formula allowance times the actual pupil 
units for the school year.  The formula allowance 
is $2,735 $2,755 for the 1988-1989 school year.  The formula 
allowance is $2,800 for fiscal year 1990. 
    Sec. 2.  Minnesota Statutes 1987 Supplement, section 
124A.22, is amended by adding a subdivision to read: 
    Subd. 7.  [DEFINITIONS FOR 1988-1989 SUPPLEMENTAL 
REVENUE.] (a) The definitions in this subdivision apply only to 
subdivision 8. 
    (b) "1987-1988 revenue" means the sum of the following 
categories of revenue for a district for the 1987-1988 school 
year: 
    (1) basic foundation revenue, tier revenue, and declining 
pupil unit revenue, according to Minnesota Statutes 1986, as 
supplemented by Minnesota Statutes 1987 Supplement, chapter 
124A, plus any reduction to second tier revenue, according to 
Minnesota Statutes 1986, section 124A.08, subdivision 5; 
    (2) teacher retirement and FICA aid, according to Minnesota 
Statutes 1986, sections 124.2162 and 124.2163; 
    (3) chemical dependency aid, according to Minnesota 
Statutes 1986, section 124.246; 
    (4) gifted and talented education aid, according to 
Minnesota Statutes 1986, section 124.247; 
    (5) interdistrict cooperation aid and levy, according to 
Minnesota Statutes 1986, sections 124.272 and 275.125, 
subdivision 8a; 
    (6) arts education aid, according to Minnesota Statutes 
1986, section 124.275; 
    (7) summer program aid and levy, according to Minnesota 
Statutes 1986, sections 124A.03 and 124A.033; 
    (8) programs of excellence grants, according to Minnesota 
Statutes 1986, section 126.60; and 
    (9) liability insurance levy, according to Minnesota 
Statutes 1986, section 466.06. 
    For the purpose of this subdivision, intermediate districts 
and other employing units, as defined in Minnesota Statutes 
1986, section 124.2161, shall allocate the amount of their 
teacher retirement and FICA aid for fiscal year 1988 among their 
participating school districts.  
    (c) "Minimum allowance" for a district means: 
    (1) the district's 1987-1988 revenue, according to 
subdivision 1; divided by 
    (2) the district's 1987-1988 actual pupil units, adjusted 
for the change in secondary pupil unit weighting from 1.4 to 
1.35 made by Laws 1987, chapter 398; plus 
    (3) $70. 
    Sec. 3.  Minnesota Statutes 1987 Supplement, section 
124A.22, is amended by adding a subdivision to read: 
    Subd. 9.  [DEFINITIONS FOR SUPPLEMENTAL REVENUE.] (a) The 
definitions in this subdivision apply only to subdivision 8. 
    (b) "1987-1988 revenue" means the sum of the following 
categories of revenue for a district for the 1987-1988 school 
year: 
    (1) basic foundation revenue, tier revenue, and declining 
pupil unit revenue, according to Minnesota Statutes 1986, as 
supplemented by Minnesota Statutes 1987 Supplement, chapter 
124A, plus any reduction to second tier revenue, according to 
Minnesota Statutes 1986, section 124A.08, subdivision 5; 
    (2) teacher retirement and FICA aid, according to Minnesota 
Statutes 1986, sections 124.2162 and 124.2163; 
    (3) chemical dependency aid, according to Minnesota 
Statutes 1986, section 124.246; 
    (4) gifted and talented education aid, according to 
Minnesota Statutes 1986, section 124.247; 
    (5) arts education aid, according to Minnesota Statutes 
1986, section 124.275; 
    (6) summer program aid and levy, according to Minnesota 
Statutes 1986, sections 124A.03 and 124A.033; 
    (7) programs of excellence grants, according to Minnesota 
Statutes 1986, section 126.60; and 
    (8) liability insurance levy, according to Minnesota 
Statutes 1986, section 466.06. 
    For the purpose of this subdivision, intermediate districts 
and other employing units, as defined in Minnesota Statutes 
1986, section 124.2161, shall allocate the amount of their 
teacher retirement and FICA aid for fiscal year 1988 among their 
participating school districts.  
    (c) "Minimum allowance" for a district means: 
    (1) the district's 1987-1988 revenue, according to 
subdivision 1; divided by 
    (2) the district's 1987-1988 actual pupil units, adjusted 
for the change in secondary pupil unit weighting from 1.4 to 
1.35 made by Laws 1987, chapter 398; plus 
    (3) $105. 
    Sec. 4.  Minnesota Statutes 1987 Supplement, section 
124A.23, subdivision 1, is amended to read:  
    Subdivision 1.  [GENERAL EDUCATION MILL RATE.] The 
commissioner of revenue shall establish the general education 
mill rate and certify it to the commissioner of education by 
August September 1 of each year for levies payable in the 
following year.  The general education mill rate shall be a 
rate, rounded up to the nearest tenth of a mill, that, when 
applied to the adjusted assessed valuation for all districts, 
raises the amount specified in this subdivision.  The general 
education mill rate for the 1989 1990 fiscal year shall be the 
rate that raises $1,079,000,000 $1,100,580,000.  The general 
education mill rate certified by the commissioner of 
revenue must may not be changed due to changes or corrections 
made to a district's adjusted assessed valuation after the mill 
rate has been certified.  
    Sec. 5.  Minnesota Statutes 1987 Supplement, section 
124A.23, subdivision 4, is amended to read:  
    Subd. 4.  [GENERAL EDUCATION AID.] A district's general 
education aid is the sum of the following amounts:  
    (1) the product of (i) the difference between the general 
education revenue, excluding supplemental revenue, and the 
general education levy, multiplied times (ii) the ratio of the 
actual amount levied to the permitted levy; 
    (2) the product of (i) the difference between the 
supplemental revenue and the supplemental levy, times (ii) the 
ratio of the actual amount levied to the permitted levy; and 
    (3) shared time aid according to section 124A.02, 
subdivision 21. 
    Sec. 6.  Minnesota Statutes 1987 Supplement, section 
124A.23, subdivision 5, is amended to read:  
    Subd. 5.  [USES OF REVENUE.] (a) General education revenue 
may be used during the regular school year and the summer for 
general and special school purposes. 
    (b) General education revenue may not be used: 
    (1) for premiums for motor vehicle insurance protecting 
against injuries or damages arising from the operation of 
district-owned, leased, or controlled vehicles to transport 
pupils for which state aid is authorized under section 124.223; 
or 
    (2) for any purpose for which the district may levy 
according to section 275.125, subdivision 5e.  
    Sec. 7.  Minnesota Statutes 1987 Supplement, section 
124A.24, is amended to read:  
    124A.24 [GENERAL EDUCATION LEVY EQUITY.] 
    If a district's general education levy is determined 
according to section 124A.23, subdivision 3, an amount must be 
deducted from state aid authorized in this chapter and chapter 
124, receivable for the same school year, and from other state 
payments receivable for the same school year authorized in 
sections 273.115; 273.116; 273.123, subdivision 6; 273.13, 
subdivision 15a; and Laws 1983, chapter 342, article 8, section 
8.  The aid in section 124.646 must not be reduced. 
    The amount of the deduction equals the difference between: 
    (1) the general education mill rate, according to section 
124A.23, times the district's adjusted assessed valuation used 
to determine the general education aid for the same school year; 
and 
    (2) the district's general education revenue for the same 
school year, according to section 124A.22. 
    However, for fiscal year 1989, the amount of the deduction 
shall be one-fourth of the difference between clauses (1) and 
(2); for fiscal year 1990, the amount of the deduction shall be 
one-third of the difference between clauses (1) and (2); for 
fiscal year 1990 1991, the amount of the deduction shall be 
one-half of the difference between clauses (1) and (2); and for 
fiscal year 1992, the amount of the deduction shall be 
four-sixths of the difference between clauses (1) and (2); and 
for fiscal year 1991 1993, the amount of the deduction shall 
be three-fourths five-sixths of the difference between clauses 
(1) and (2).  
    Sec. 8.  Minnesota Statutes 1987 Supplement, section 
124A.27, subdivision 1, is amended to read:  
    Subdivision 1.  [REQUIREMENT.] An amount equal to 1.85 2.20 
percent of the basic revenue under section 124A.22, subdivision 
2, shall be reserved and may be used only to provide one or more 
of the programs enumerated in this section.  The school board 
shall determine which programs to provide, the manner in which 
they will be provided, and the extent to which other money may 
be used for the programs.  Except for the requirements of 
sections 124A.28 and 124A.29, the remaining general education 
revenue under section 124A.22 and supplemental revenue under 
section 124A.25 may be used to provide one or more of the 
programs enumerated in this section.  
    Sec. 9.  Minnesota Statutes 1987 Supplement, section 
124A.28, subdivision 1, is amended to read:  
    Subdivision 1.  [USE OF THE REVENUE.] The compensatory 
education revenue under section 124A.22, subdivision 3, may be 
used only to meet the special educational needs of pupils whose 
educational achievement is below the level that is appropriate 
for pupils of their age.  These needs may be met by providing at 
least some of the following: 
    (1) remedial instruction in reading, language arts, and 
mathematics to improve the achievement level of these pupils; 
    (2) additional teachers and teacher aides to provide more 
individualized instruction to these pupils; 
    (3) summer programs that enable these pupils to improve 
their achievement or that reemphasize material taught during the 
regular school year; 
    (4) in-service education for teachers, teacher aides, 
principals, and other personnel to improve their ability to 
recognize these pupils and provide appropriate responses to the 
pupils' needs; 
    (5) for instruction of instructional material for these 
pupils, including:  textbooks, workbooks, periodicals, 
pamphlets, photographs, reproductions, filmstrips, prepared 
slides, prerecorded video programs, sound recordings, desk 
charts, games, study prints and pictures, desk maps, models, 
learning kits, blocks and cubes, flashcards, instructional 
computer software programs, pencils, pens, crayons, notebooks, 
duplicating fluids, and papers; 
    (6) 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; and 
    (7) bilingual programs, bicultural programs, and programs 
for pupils of limited English proficiency. 
    Sec. 10.  Minnesota Statutes 1987 Supplement, section 
124A.28, is amended by adding a subdivision to read: 
    Subd. 3.  [ANNUAL EXPENDITURE REPORT.] Each year a district 
that receives compensatory education revenue shall submit a 
report identifying the expenditures it incurred in providing 
compensatory education to the pupils described in subdivision 
1.  The report must conform to uniform financial and reporting 
standards established for this purpose. 
    Sec. 11.  [COST OF LIVING STUDY.] 
    The legislative audit commission is encouraged to direct 
the legislative auditor to conduct a study of the differences 
among the costs of living in communities throughout the state 
and the effect that these differences have on educational 
expenditures by school districts.  The study shall include an 
analysis of at least the following factors:  food, housing, real 
estate taxes, utilities, transportation, medical costs, median 
income of families, median home values, median rental costs, and 
median monthly salaries for representative occupations.  
    Sec. 12.  [INSTRUCTIONS TO THE DEPARTMENT OF EDUCATION FOR 
1988 LEVY LIMITATIONS.] 
    Notwithstanding sections 1 and 2, and any other law to the 
contrary, the department of education shall determine, for the 
1988-1989 school year only, levies under chapter 124A as they 
were authorized under Laws 1987, chapter 398, article 1.  
    Sec. 13.  [APPROPRIATIONS.] 
    There is appropriated from the general fund to the 
department of education the sum of $6,903,400 for general 
education aid for the 1988-1989 school year.  This sum is added 
to the sum appropriated in Laws 1987, chapter 398, article 1, 
section 26, subdivision 2.  
    Sec. 14.  [REPEALER.] 
    Notwithstanding any law enacted in 1988 that amends 
Minnesota Statutes 1987 Supplement, section 124A.27, subdivision 
10, Minnesota Statutes 1987 Supplement, section 124A.27, 
subdivision 10, is repealed.  Section 2 is repealed June 30, 
1989. 
    Sec. 15.  [EFFECTIVE DATE.] 
    Section 3 is effective for revenue for the 1989-1990 school 
year and thereafter. 

                               ARTICLE 2

                             TRANSPORTATION
    Section 1.  Minnesota Statutes 1986, section 120.73, 
subdivision 1, is amended to read:  
    Subdivision 1.  A school board is authorized to require 
payment of fees in the following areas: 
    (a) 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; 
    (b) Admission fees or charges for extra curricular 
activities, where attendance is optional; 
    (c) A security deposit for the return of materials, 
supplies, or equipment; 
    (d) 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 school board; 
    (e) Items of personal use or products which a student has 
an option to purchase such as student publications, class rings, 
annuals, and graduation announcements; 
    (f) Fees specifically permitted by any other statute, 
including but not limited to section 171.04, clause (1); 
    (g) Field trips considered supplementary to a district 
educational program; 
    (h) Any authorized voluntary student health and accident 
benefit plan; 
    (i) 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; 
    (j) Transportation of pupils to and from extra curricular 
activities conducted at locations other than school, where 
attendance is optional; 
    (k) Transportation of pupils to and from school for which 
aid is not authorized under section 124.223, clause (1), and for 
which levy is not authorized under section 275.125, subdivision 
5e, if a district charging fees for transportation of pupils 
establishes guidelines for that transportation to ensure that no 
pupil is denied transportation solely because of inability to 
pay;  
    (l) Motorcycle classroom education courses conducted 
outside of regular school hours; provided the charge shall not 
exceed the actual cost of these courses to the school district. 
    Sec. 2.  Minnesota Statutes 1986, section 120.74, 
subdivision 1, is amended to read:  
    Subdivision 1.  A school board is not authorized to charge 
fees in the following areas: 
    (a) Textbooks, workbooks, art materials, laboratory 
supplies, towels; 
    (b) Supplies necessary for participation in any 
instructional course except as authorized in sections 120.73 and 
120.75; 
    (c) Field trips which are required as a part of a basic 
education program or course; 
    (d) Graduation caps, gowns, any specific form of dress 
necessary for any educational program, and diplomas; 
    (e) Instructional costs for necessary school personnel 
employed in any course or educational program required for 
graduation; 
    (f) Library books required to be utilized for any 
educational course or program; 
    (g) Admission fees, dues, or fees for any activity the 
pupil is required to attend; 
    (h) Any admission or examination cost for any required 
educational course or program; 
    (i) Locker rentals; 
    (j) Transportation of pupils (1) to and from school as 
authorized pursuant to section 123.39 or (2) for which state 
transportation aid is authorized pursuant to section 124.223 or 
(2) for which a levy is authorized under section 275.125, 
subdivision 5e. 
    Sec. 3.  Minnesota Statutes 1987 Supplement, section 
123.39, subdivision 1, is amended to read:  
    Subdivision 1.  The board may provide for the free 
transportation of pupils to and from school, and 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.  Every driver shall possess 
all the qualifications required by the rules of the state board 
of education.  In any school district, the board shall arrange 
for the attendance of all pupils living two miles or more from 
the school through suitable provision for transportation or 
through the boarding and rooming of the pupils who may be more 
economically and conveniently provided for by that means.  The 
board shall provide transportation to and from the home of a 
handicapped child not yet enrolled in kindergarten when special 
instruction and services under section 120.17 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 and any other matter relating 
thereto shall be within the sole discretion, control, and 
management of the school 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. 4.  Minnesota Statutes 1987 Supplement, section 
124.223, is amended to read:  
    124.223 [TRANSPORTATION AID AUTHORIZATION.] 
    School transportation and related services for which state 
transportation aid is authorized are: 
    (1)  [TO AND FROM SCHOOL; BETWEEN SCHOOLS.] Transportation 
or board of resident elementary pupils who reside one mile or 
more from the public schools which they could attend; 
transportation or board of resident secondary pupils who reside 
two miles or more from the public schools which they could 
attend; transportation to, and from schools the resident pupils 
attend according to a program approved by the commissioner of 
education, or between the schools the resident pupils 
attend pursuant to a program approved by the commissioner of 
education for instructional classes; transportation of resident 
elementary pupils who reside one mile or more from a nonpublic 
school actually attended; transportation of resident secondary 
pupils who reside two miles or more from a nonpublic school 
actually attended; but with respect to transportation of pupils 
to nonpublic schools actually attended, only to the extent 
permitted by sections 123.76 to 123.79; transportation of pupils 
who are custodial parents to and from the provider of child care 
services for the pupil's child, within the attendance area of 
the school the pupil attends; 
    For the purposes of this clause, a district may designate a 
licensed day care facility or the residence of a relative as the 
home of a pupil for part or all of the day, if requested by the 
pupil's parent or guardian and if that facility or residence is 
within the attendance area of the school the pupil attends.;  
    (2)  [OUTSIDE DISTRICT.] Transportation to and from or 
board and lodging in another district, of resident pupils of a 
district without a secondary school; the pupils may attend a 
classified secondary school in another district and shall 
receive board and lodging in or transportation to and from a 
district having a classified secondary school at the expense of 
the district of the pupil's residence; 
    (3)  [SECONDARY VOCATIONAL CENTERS.] Transportation to and 
from a state board approved secondary vocational center for 
secondary vocational classes for resident pupils of any of the 
districts who are members of or participating in programs at 
that center; 
    (4)  [HANDICAPPED.] Transportation or board and lodging of 
a handicapped pupil when that pupil cannot be transported on a 
regular school bus, the conveying of handicapped pupils between 
home and school and within the school plant, necessary 
transportation of handicapped pupils from home or from school to 
other buildings, including centers such as developmental 
achievement centers, hospitals and treatment centers where 
special instruction or services required by section 120.17 are 
provided, within or outside the district where services are 
provided, and necessary transportation for resident handicapped 
pupils required by section 120.17, subdivision 4a.  
Transportation of handicapped pupils between home and school 
shall not be subject to any distance requirement for children 
not yet enrolled in kindergarten or to the requirement in clause 
(1) that elementary pupils reside at least one mile from school 
and secondary pupils reside at least two miles from school in 
order for the transportation to qualify for aid; 
    (5)  [BOARD AND LODGING; NONRESIDENT HANDICAPPED.] When 
necessary, board and lodging for nonresident handicapped pupils 
in a district maintaining special classes; 
    (6)  [SHARED TIME.] Transportation from one educational 
facility to another within the district for resident pupils 
enrolled on a shared time basis in educational programs approved 
by the commissioner of education, and necessary transportation 
required by section 120.17, subdivision 9, for resident 
handicapped pupils who are provided special instruction and 
services on a shared time basis; 
    (7)  [FARIBAULT STATE ACADEMIES.] Transportation for 
residents to and from the Minnesota state academy for the deaf 
or the Minnesota state academy for the blind; 
    (8)  [SUMMER INSTRUCTIONAL PROGRAMS.] Services described in 
clauses (1) to (7), (9), and (10) when provided in conjunction 
with a summer program eligible for aid and levy under sections 
124A.03 and 124A.033; 
    (9)  [COOPERATIVE ACADEMIC AND VOCATIONAL.] Transportation 
to, from or between educational facilities located in any of two 
or more school districts jointly offering academic 
classes approved by the commissioner or secondary vocational 
classes not provided at a secondary vocational center which are 
approved by the commissioner for resident pupils of any of these 
districts; and 
    (10)  [NONPUBLIC SUPPORT SERVICES.] Necessary 
transportation within district boundaries between a nonpublic 
school and a public school or a neutral site for nonpublic 
school pupils who are provided pupil support services pursuant 
to section 123.935. 
    Sec. 5.  Minnesota Statutes 1987 Supplement, section 
124.225, subdivision 8a, is amended to read:  
    Subd. 8a.  [AID.] (a) For the 1986-1987 and 1987-1988 
school years, a district's transportation aid shall equal the 
sum of its basic transportation aid pursuant to subdivision 8b, 
its nonregular transportation aid pursuant to subdivision 8i, 
and its nonregular transportation levy equalization aid pursuant 
to subdivision 8j, minus its contracted services aid reduction 
pursuant to subdivision 8k, minus the amount raised by 2.25 
mills times the adjusted assessed valuation which is used to 
compute the transportation levy limitation for the levy 
attributable to that school year.  A district may levy less than 
the amount raised by 2.25 mills.  Transportation aid shall be 
computed as if the district had levied the amount raised by 2.25 
mills. 
    (b) For the 1988-1989 school year and thereafter, a 
district's transportation aid is equal to the sum of its basic 
transportation aid under subdivision 8b, its nonregular 
transportation aid under subdivision 8i, and its nonregular 
transportation levy equalization aid under subdivision 8j, minus 
its contracted services aid reduction under subdivision 8k, and 
minus its basic transportation levy limitation for the levy 
attributable to that school year under section 275.125, 
subdivision 5. 
    (c) (b) If the total appropriation for transportation aid 
for any fiscal year is insufficient to pay all districts the 
full amount of aid earned, the department of education shall 
reduce each district's aid in proportion to the number of 
resident pupils in average daily membership in the district to 
the state total average daily membership, and shall reduce the 
aid entitlement transportation levy of off-formula districts in 
the same proportion. 
    Sec. 6.  Minnesota Statutes 1987 Supplement, section 
275.125, subdivision 5, is amended to read:  
    Subd. 5.  [BASIC TRANSPORTATION LEVY.] Each year, a school 
district may levy for school transportation services an amount 
not to exceed the amount raised by the basic transportation mill 
rate times the adjusted assessed valuation of the district for 
the preceding year.  The commissioner of revenue shall establish 
the basic transportation mill rate and certify it to the 
commissioner of education by August September 1 of each year for 
levies payable in the following year.  The basic transportation 
mill rate shall be a rate, rounded up to the nearest hundredth 
of a mill, that, when applied to the adjusted assessed valuation 
of taxable property for all districts, raises the amount 
specified in this subdivision.  The basic transportation mill 
rate for the 1987 payable 1988 levies and for transportation aid 
for the 1988-1989 school 1990 fiscal year shall be the rate that 
raises $71,256,100 $72,681,200.  The basic transportation mill 
rate certified by the commissioner of revenue must not be 
changed due to changes or corrections made to a district's 
adjusted assessed valuation after the mill rate has been 
certified. 
    Sec. 7.  Laws 1987, chapter 398, article 2, section 13, 
subdivision 2, is amended to read: 
    Subd. 2.  [TRANSPORTATION AID.] For transportation aid 
there is appropriated: 
    $90,477,000 ..... 1988, 
    $87,334,800 $87,419,800 ..... 1989. 
    The appropriation for aid for fiscal year 1988 includes 
$12,194,300 for aid for fiscal year 1987 payable in fiscal year 
1988 and $78,282,700 for fiscal year 1988 payable in fiscal year 
1988. 
    The appropriation for aid for fiscal year 1989 includes 
$13,814,600 for aid for fiscal year 1988 payable in fiscal year 
1989 and $73,520,200 $73,605,200 for fiscal year 1989 payable in 
fiscal year 1989. 
    The appropriations are based on aid entitlements of 
$92,097,200 for fiscal year 1988 and $86,494,300 $86,594,300 for 
fiscal year 1989. 
    Sec. 8.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] There is 
appropriated from the general fund to the department of 
education the sum indicated in this section for the fiscal year 
ending June 30 in the year designated.  
    Subd. 2.  [TRANSPORTATION AID FOR OPEN ENROLLMENT.] For 
transportation of pupils attending nonresident districts 
according to Minnesota Statutes 1987 Supplement, section 
123.3515, there is appropriated:  
    $50,000 .....  1988. 
    An unexpended balance in fiscal year 1988 does not cancel 
but is available for fiscal year 1989. 
     Sec. 9.  [EFFECTIVE DATE.] 
     Section 8 is effective the day following final enactment. 

                                ARTICLE 3

                            SPECIAL PROGRAMS
    Section 1.  Minnesota Statutes 1987 Supplement, section 
120.17, subdivision 3b, is amended to read:  
    Subd. 3b.  [PROCEDURES FOR DECISIONS.] Every district shall 
utilize at least the following procedures for decisions 
involving identification, assessment, and educational placement 
of handicapped children: 
    (a) Parents and guardians shall receive prior written 
notice of:  
    (1) any proposed formal educational assessment or proposed 
denial of a formal educational assessment of their child; 
    (2) a proposed placement of their child in, transfer from 
or to, or denial of placement in a special education program; or 
    (3) the proposed provision, addition, denial or removal of 
special education services for their child; 
    (b) The district shall 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 clause (d) at the district's initiative;
    (c) Parents and guardians shall have an opportunity to meet 
with appropriate district staff in at least one conciliation 
conference if they object to any proposal of which they are 
notified pursuant to clause (a).  The conciliation process shall 
not be used to deny or delay a parent or guardian's right to a 
due process hearing.  If the parent or guardian refuses efforts 
by the district to conciliate the dispute with the school 
district, the requirement of an opportunity for conciliation 
shall be deemed to be satisfied; 
    (d) Parents, guardians, and the district shall have an 
opportunity to obtain an impartial due process hearing initiated 
and conducted in the school district where the child resides, if 
the parent or guardian continues to object to:  
    (1) a proposed formal educational assessment or proposed 
denial of a formal educational assessment of their child; 
    (2) the proposed placement of their child in, or transfer 
of their child to a special education program; 
    (3) the proposed denial of placement of their child in a 
special education program or the transfer of their child from a 
special education program; 
    (4) the proposed provision or addition of special education 
services for their child; or 
    (5) the proposed denial or removal of special education 
services for their child. 
    At least five calendar days before the hearing, the 
objecting party shall provide the other party with a brief 
written statement of the objection and the reasons for the 
objection.  
    The hearing shall take place before an impartial hearing 
officer mutually agreed to by the school board and the parent or 
guardian.  If the school board and the parent or guardian are 
unable to agree on a hearing officer, the school board shall 
request the commissioner to appoint a hearing officer.  The 
hearing officer shall not be a school board member or employee 
of the school district where the child resides or of the child's 
school district of residence, an employee of any other public 
agency involved in the education or care of the child, or any 
person with a personal or professional interest which would 
conflict with the person's objectivity at the hearing.  A person 
who otherwise qualifies as a hearing officer is not an employee 
of the district solely because the person is paid by the 
district to serve as a hearing officer.  If the hearing officer 
requests an independent educational assessment of a child, the 
cost of the assessment shall be at district expense.  The 
proceedings shall be recorded and preserved, at the expense of 
the school district, pending ultimate disposition of the action. 
    (e) The decision of the hearing officer pursuant to clause 
(d) shall be rendered not more than 45 calendar days from the 
date of the receipt of the request for the hearing.  A hearing 
officer may grant specific extensions of time beyond the 45-day 
period at the request of either party.  The decision of the 
hearing officer shall be binding on all parties unless appealed 
to the hearing review officer by the parent, guardian, or the 
school board of the district where the child resides pursuant to 
clause (f). 
    The local decision shall: 
    (1) be in writing; 
    (2) state the controlling facts upon which the decision is 
made in sufficient detail to apprise the parties and the hearing 
review officer of the basis and reason for the decision; 
    (3) state whether the special education program or special 
education services appropriate to the child's needs can be 
reasonably provided within the resources available to the 
responsible district or districts; 
    (4) state the amount and source of any additional district 
expenditure necessary to implement the decision; and 
    (5) be based on the standards set forth in subdivision 3a 
and the rules of the state board. 
    (f) Any local decision issued pursuant to clauses (d) and 
(e) may be appealed to the hearing review officer within 15 30 
calendar days of receipt of that written decision, by the 
parent, guardian, or the school board of the district where the 
child resides. 
    If the decision is appealed, a written transcript of the 
hearing shall be made by the school district and shall be 
accessible to the parties involved within five calendar days of 
the filing of the appeal.  The hearing review officer shall 
issue a final decision based on an impartial review of the local 
decision and the entire record within 30 calendar days after the 
filing of the appeal.  The hearing review officer shall seek 
additional evidence if necessary and may afford the parties an 
opportunity for written or oral argument; provided any hearing 
held to seek additional evidence shall be an impartial due 
process hearing but shall be deemed not to be a contested case 
hearing for purposes of chapter 14.  The hearing review officer 
may grant specific extensions of time beyond the 30-day period 
at the request of any party. 
    The final decision shall: 
    (1) be in writing; 
    (2) include findings and conclusions; and 
    (3) be based upon the standards set forth in subdivision 3a 
and in the rules of the state board. 
    (g) The decision of the hearing review officer shall be 
final unless appealed by the parent or guardian or school board 
to the court of appeals.  The judicial review shall be in 
accordance with chapter 14.  
    (h) The commissioner of education, having delegated general 
supervision of special education to the appropriate staff, shall 
be the hearing review officer except for appeals in which: 
    (1) the commissioner has a personal interest in or specific 
involvement with the student who is a party to the hearing;  
    (2) the commissioner has been employed as an administrator 
by the district that is a party to the hearing;  
    (3) the commissioner has been involved in the selection of 
the administrators of the district that is a party to the 
hearing;  
    (4) the commissioner has a personal, economic, or 
professional interest in the outcome of the hearing other than 
the proper administration of the federal and state laws, rules, 
and policies;  
    (5) the appeal challenges a state or local policy which was 
developed with substantial involvement of the commissioner; or 
    (6) the appeal challenges the actions of a department 
employee or official.  
    For any appeal to which the above exceptions apply, the 
state board of education shall name an impartial and competent 
hearing review officer.  
    In all appeals, the parent or guardian of the handicapped 
student or the district that is a party to the hearing may 
challenge the impartiality or competence of the proposed hearing 
review officer by applying to the state board of education.  
    (i) Pending the completion of proceedings pursuant to this 
subdivision, unless the district and the parent or guardian of 
the child agree otherwise, the child shall remain in the child's 
current educational placement and shall not be denied initial 
admission to school. 
    (j) The child's school district of residence, if different 
from the district where the child actually resides, shall 
receive notice of and may be a party to any hearings or appeals 
pursuant to this subdivision. 
    Sec. 2.  Minnesota Statutes 1987 Supplement, section 
124.17, subdivision 1, is amended to read:  
    Subdivision 1.  [PUPIL UNIT.] Pupil units for each resident 
pupil in average daily membership shall be counted according to 
this subdivision.  
    (a) A handicapped prekindergarten pupil who is enrolled for 
the entire school fiscal year in a program approved by the 
commissioner and has an individual education plan that requires 
up to 437 hours of assessment and education services in 
the school fiscal year is counted as one-half of a pupil unit.  
If the plan requires more than 437 hours of assessment and 
education services, the pupil is counted as the ratio of the 
number of hours of assessment and education service to 875, but 
not more than one. 
    (b) A handicapped prekindergarten pupil who is enrolled for 
less than the entire school fiscal year in a program approved by 
the commissioner is counted as the greater of (1) one-half times 
the ratio of the number of instructional days from the date the 
pupil is enrolled to the date the pupil withdraws to the number 
of instructional days in the school year, or (2) the ratio of 
the number of hours of assessment and education service required 
in the school fiscal year by the pupil's individual education 
program plan to 875, but not more than one. 
    (c) 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 875.  
    (d) A handicapped kindergarten pupil 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 school fiscal year by the pupil's individual 
education program plan to 875, but not more than one. 
    (e) A kindergarten pupil who is not included in paragraph 
(d) is counted as one-half of a pupil unit. 
    (f) A pupil who is in any of grades one to six is counted 
as one pupil unit. 
    (g) For the 1987-1988 school year, a pupil who is in any of 
grades seven to 12 is counted as 1.4 pupil units.  For the 
1988-1989 and later school years, A pupil who is in any of 
grades seven to 12 is counted as 1.35 pupil units.  
    Sec. 3.  Minnesota Statutes 1986, section 124.48, 
subdivision 2, is amended to read:  
    Subd. 2.  [REPORT TO LEGISLATURE.] By December 1 of each 
even-numbered year, the state board of education shall report to 
the education committees of the legislature about the status of 
Indian scholarships and the, recipients, and the status of 
academic programs and student services for American Indian 
people in post-secondary institutions that enroll recipients of 
American Indian scholarships.  
    Sec. 4.  Minnesota Statutes 1986, section 126.151, is 
amended to read: 
    126.151 [VOCATIONAL EDUCATION STUDENT ORGANIZATIONS.] 
    Subdivision 1.  [ACTIVITIES OF THE ORGANIZATION.] Any pupil 
student enrolled in a vocational technical education program 
approved by the state board boards of education and vocational 
technical education may belong to a vocational student 
organization which that is operated as an integral part of 
the vocational program.  The commissioner of education and the 
state director of vocational technical education may provide 
necessary technical assistance and leadership to these 
organizations at the state level for administration of approved 
vocational student organizations and fiscal accounts, including 
administration of state and national conferences.  
    Subd. 2.  [ACCOUNTS OF THE ORGANIZATION.] The state boards 
of education and vocational technical education may retain dues 
and other money collected on behalf of students participating in 
approved vocational student organizations and may deposit the 
money in separate accounts.  The money in these accounts shall 
be available for expenditures for state and national activities 
related to specific organizations.  Administration of money 
collected under this section is not subject to the provisions of 
chapters 15, 16A, and 16B, and may be deposited outside the 
state treasury.  Money shall be administered under the policies 
of the applicable state board or agency relating to 
post-secondary vocational student organizations and is subject 
to audit by the legislative auditor.  Any unexpended money shall 
not cancel but may be carried forward to the next fiscal year. 
    Sec. 5.  Minnesota Statutes 1986, section 126.45, is 
amended to read:  
    126.45 [CITATION.] 
    Sections 126.45 to 126.55 may be cited as the American 
Indian language and culture education act of 1988. 
    Sec. 6.  Minnesota Statutes 1986, section 126.46, is 
amended to read:  
    126.46 [DECLARATION OF POLICY.] 
    The legislature finds that a more adequate education is 
needed for American Indian pupils people in the state of 
Minnesota.  The legislature recognizes the unique educational 
and culturally-related academic needs of American Indian 
people.  The legislature also is concerned about the lack of 
American Indian teachers in the state.  Therefore, pursuant to 
the policy of the state to ensure equal educational opportunity 
to every individual, it is the purpose of sections 126.45 to 
126.55 to provide for the establishment of American Indian 
language and culture education programs specially designed to 
meet these unique educational or culturally-related academic 
needs or both. 
    Sec. 7.  Minnesota Statutes 1986, section 126.47, is 
amended to read:  
    126.47 [DEFINITIONS.] 
    Subdivision 1.  For the purposes of sections 126.45 to 
126.55, the words, phrases, and terms defined in this section 
shall have the meanings given to them. 
    Subd. 2.  "American Indian child" means any child, living 
on or off a reservation, who is enrolled or eligible for 
enrollment in a federally recognized tribe. 
    Subd. 3.  "Advisory task force" means the state advisory 
task force on American Indian language and culture education 
programs. 
    Subd. 4.  "Participating school" means any nonsectarian 
nonpublic, tribal, or alternative school offering a curriculum 
reflective of American Indian culture which is funded by and 
participates in the programs in sections 126.45 to 126.55 and 
"American Indian school" mean a school that: 
    (1) is not operated by a school district; and 
    (2) is eligible for a grant under Title IV of the Indian 
Education Act for the education of American Indian children. 
    Sec. 8.  Minnesota Statutes 1986, section 126.49, 
subdivision 1, is amended to read:  
    Subdivision 1.  [AMERICAN INDIAN LANGUAGE AND CULTURE 
EDUCATION LICENSES.] The board of teaching shall grant initial 
and continuing teaching licenses in American Indian language and 
culture education that bear the same duration as other initial 
and continuing licenses.  The board shall grant licenses to 
persons who present satisfactory evidence that they: 
    (a) Possess competence in an American Indian language or 
possess unique qualifications relative to or knowledge and 
understanding of American Indian history and culture; or 
    (b) Possess a bachelor's degree or other academic degree 
approved by the board or meet such requirements as to course of 
study and training as the board may prescribe, or possess such 
relevant experience as the board may prescribe. 
    This evidence may be presented by affidavits, resolutions, 
or by such other methods as the board may prescribe.  
Individuals may present applications for licensure on their own 
behalf or these applications may be submitted by the 
superintendent or other authorized official of a school district 
or a nonsectarian nonpublic, tribal, or alternative school 
offering a curriculum reflective of, participating school, or an 
American Indian culture school. 
    Sec. 9.  [126.501] [RECRUITING AND RETAINING INDIAN 
TEACHERS.] 
    This section applies to a school board of a school district 
in which there are at least ten American Indian children 
enrolled.  The school board shall actively recruit teacher 
applicants who are American Indian from the time it is 
reasonably expected that a position will become available until 
the position is filled or September 1, whichever is earlier.  
Notwithstanding section 125.12, subdivisions 4, 6a, or 6b, 
125.17, subdivisions 3 and 11, any other law to the contrary, or 
any provision of a contract entered into after the effective 
date of this section to the contrary, when placing a teacher on 
unrequested leave of absence, the board may retain a 
probationary teacher or a teacher with less seniority in order 
to retain an American Indian teacher. 
    Sec. 10.  Minnesota Statutes 1986, section 126.51, 
subdivision 1, is amended to read:  
    Subdivision 1.  [PARENT COMMITTEE.] School boards and 
participating American Indian schools shall provide for the 
maximum involvement of parents of children enrolled in American 
Indian language and culture education programs pursuant to 
sections 126.45 to 126.55, including language and culture 
education programs, programs for elementary and secondary 
grades, special education programs, and support services.  
Accordingly, before implementing a program, each the school 
district and participating board of a school district in which 
there are ten or more American Indian children enrolled and each 
American Indian school shall establish a parent advisory 
committee for that program.  If a committee of parents of 
American Indian children has been or is established according to 
federal, tribal, or other state law, that committee shall serve 
as the committee required by this section and shall be subject 
to, at least, the requirements of this section.  
     The parent committee shall develop its recommendations in 
consultation with the curriculum advisory committee required by 
section 126.666, subdivision 2.  This committee shall afford 
parents the necessary information and the opportunity 
effectively to express their views concerning all aspects of the 
American Indian language and culture education program and the 
educational needs of the American Indian children residing 
within the district's or school's attendance boundaries enrolled 
in the school or program.  The committee shall also address the 
need for adult education programs for American Indian people in 
the community.  The district school board or participating 
American Indian school shall ensure that the program is programs 
are planned, operated, and evaluated with the involvement of and 
in consultation with parents of children eligible to be served 
by the program programs. 
    Sec. 11.  Minnesota Statutes 1986, section 126.51, is 
amended by adding a subdivision to read: 
    Subd. 1a.  [RESOLUTION OF CONCURRENCE.] By September 15 and 
June 15 of each school year, the school board or American Indian 
school shall submit to the department of education a copy of a 
resolution adopted by the parent committee.  The copy must be 
signed by the chair of the committee and must state whether the 
committee concurs with the educational programs for American 
Indian children offered by the school board or American Indian 
school.  If the committee does not concur with the educational 
programs, the reasons for nonconcurrence and recommendations 
shall be submitted with the resolution.  
    Sec. 12.  Minnesota Statutes 1986, section 126.51, 
subdivision 2, is amended to read:  
    Subd. 2.  [MEMBERSHIP.] The committees committee shall be 
composed solely of parents of children eligible to be enrolled 
in American Indian language and culture education programs; 
secondary students eligible to be served; American Indian 
language and culture education teachers and aides; American 
Indian teachers; counselors; adult American Indian people 
enrolled in educational programs; and representatives from 
community groups; provided, however, that.  A majority of each 
committee shall be parents of children enrolled or eligible to 
be enrolled in the corresponding program, and that programs.  
The number of parents of American Indian and non-American Indian 
children shall reflect approximately the proportion of children 
of those groups enrolled in the program programs. 
    Sec. 13.  Minnesota Statutes 1986, section 126.51, 
subdivision 4, is amended to read:  
    Subd. 4.  [ALTERNATE COMMITTEE.] If the organizational 
membership or the board of directors of a participating an 
American Indian school consists solely of parents of children 
attending the school whose children are eligible to be enrolled 
in American Indian language and culture education programs, that 
membership or board may serve also as the parent advisory 
committee. 
    Sec. 14.  Minnesota Statutes 1986, section 126.52, is 
amended to read:  
    126.52 [STATE BOARD OF EDUCATION DUTIES.] 
    Subd. 5.  [COMMUNITY INVOLVEMENT.] The state board shall 
provide for the maximum involvement of the state advisory task 
force committees on American Indian language and culture 
education, parents of American Indian children, secondary 
students eligible to be served, American Indian language and 
culture education teachers, American Indian teachers, teachers' 
aides, representatives of community groups, and persons 
knowledgeable in the field of American Indian language and 
culture education, in the formulation of policy and procedures 
relating to the administration of sections 126.45 to 126.55.  
    Subd. 8.  [TECHNICAL ASSISTANCE.] The state board shall 
provide technical assistance to school districts, participating 
schools and post secondary post-secondary institutions for 
preservice and in-service training for American Indian language 
and culture education teachers and teacher's aides, teaching 
methods, curriculum development, testing and testing mechanisms, 
and the development of materials for American Indian language 
and culture education programs. 
    Subd. 9.  [APPLICATION FOR FUNDS.] The state board shall 
apply for grants or funds money which are, or may become, be 
available under federal programs for American Indian language 
and culture education, including funds for administration, 
demonstration projects, training, technical assistance, planning 
and evaluation. 
    Subd. 11.  [RULES.] The state board, upon the receipt of 
recommendations by the advisory task force appropriate state 
committees, may promulgate rules providing for standards and 
procedures appropriate for the implementation of and within the 
limitations of sections 126.45 to 126.55. 
    Sec. 15.  Minnesota Statutes 1986, section 126.531, is 
amended to read:  
    126.531 [ADVISORY TASK FORCE COMMITTEES ON AMERICAN INDIAN 
LANGUAGE AND CULTURE EDUCATION PROGRAMS.] 
    Subdivision 1.  The state board of education may shall 
create an one or more American Indian language and culture 
education advisory task force committees.  If created, Members 
shall include representatives of tribal bodies, community 
groups, parents of children eligible to be served by the 
programs, American Indian administrators and teachers, persons 
experienced in the training of teachers for American 
Indian language and culture education programs, persons involved 
in programs for American Indian children in nonsectarian 
nonpublic, urban, community, tribal or alternative American 
Indian schools, and persons knowledgeable in the field of 
American Indian language and culture education.  Members shall 
be appointed so as to be representative of significant segments 
of the population of American Indians.  
    Subd. 2.  The advisory task force Each committee on 
American Indian language and culture education programs shall 
advise the state board in the administration of its duties under 
sections 126.45 to 126.55 and other programs for the education 
of American Indian people, as determined by the state board.  
    Subd. 3.  The advisory task force Each committee shall 
expire and the terms, compensation and removal of members shall 
be as provided for in be reimbursed for expenses according to 
section 15.059, subdivision 6.  The state board shall determine 
the membership terms and the duration of each committee. 
    Sec. 16.  Laws 1987, chapter 398, article 3, section 39, 
subdivision 7, is amended to read: 
    Subd. 7.  [AMERICAN INDIAN SCHOLARSHIPS.] For American 
Indian scholarships, according to Minnesota Statutes, section 
124.48, there is appropriated: 
    $1,581,800 ..... 1988, 
    $1,581,800 ..... 1989. 
    At least $50,000 of the appropriation for fiscal year 1989 
must be used for scholarships for students who are enrolled in 
teacher preparation programs. 
    The state board of education, with the advice of the 
Minnesota Indian scholarship committee, shall develop a 
scholarship program for American Indian people to become 
teachers.  The program may involve incentives for students, such 
as loans that are forgiven, in part, upon completing three years 
of teaching.  If requested, the higher education coordinating 
board shall assist the state board or the committee in 
developing the program.  The program plan shall be reported to 
the education committees of the legislature by January 1, 1989. 
    Any unexpended balance remaining in the first year does not 
cancel but is available for fiscal year 1989. 
    Sec. 17.  Laws 1987, chapter 398, article 3, section 39, 
subdivision 8, is amended to read: 
    Subd. 8.  [AMERICAN INDIAN POST-SECONDARY PREPARATION 
GRANTS.] For Indian post-secondary preparation grants, according 
to Minnesota Statutes, section 124.481, there is appropriated: 
    $781,400 ..... 1988, 
    $781,400 $856,400 ..... 1989. 
    Sec. 18.  [INDIAN SCHOOL COUNCIL.] 
    Subdivision 1.  [INTENTION.] It is the intention of the 
legislature to establish opportunities for American Indian 
control of Indian education through Indian public schools, an 
urban Indian school district or districts, or other means. 
    Subd. 2.  [INDIAN SCHOOL COUNCIL.] (a) An Indian school 
council composed of 15 members is established to develop 
recommendations for Indian public schools, an urban Indian 
school district or districts, or other means of achieving Indian 
control of Indian education.  The state board of education shall 
appoint two of its members to serve on the council.  The board 
of independent school district No. 625, St. Paul, and the board 
of special school district No. 1, Minneapolis, shall each 
appoint one of its members to serve on the council.  The 
remaining members must be appointed by the governor, with the 
assistance of the Indian affairs council, as provided in section 
3.922, subdivision 6, clause (6). 
    (b) The council chair must be elected by the members of the 
council.  Minnesota Statutes, section 15.059, subdivisions 3 and 
4, apply to compensation and removal of members of the council.  
The council terminates on June 1, 1989.  If requested by the 
council, the department of education and the Indian affairs 
council must provide assistance. 
    Subd. 3.  [RECOMMENDATIONS.] (a) The council shall make 
recommendations about each of the items in this subdivision.  It 
may make recommendations about additional options or issues.  
    (b) It shall consider the governance and administration of 
schools or programs for Indian education, including 
participation by Minnesota tribal governments in the governance 
and administration. 
    (c) It shall consider methods of forming schools or 
programs, including, but not limited to: 
    (1) forming a school within an existing school district 
with a separate governing board, similar to Minnesota Statutes, 
chapter 128B; 
    (2) forming a school district by dividing an existing 
district; 
    (3) forming a special purpose school district superimposed 
on one or more existing school districts, similar to Minnesota 
Statutes, chapter 136D; or 
     (4) forming a state school, similar to Minnesota Statutes, 
chapter 128A or 129C. 
     The structure may be similar to but different from any 
other existing school or school district. 
     (d) It shall consider a governing board or boards that may 
be appointed or elected, but which, in any case, shall include 
significant democratic participation by tribal governments and 
parents or guardians.  The appointing authority or authorities 
must be specified for appointed members.  The election process, 
including the qualification of voters, must be specified for 
elected members.  The initial board members may be selected by a 
different method than subsequent board members. 
     (e) It shall consider financing, including: 
     (1) property taxes that may be levied by a school district, 
if formed; distributed on an equitable basis by the school 
district in which the school is located; or distributed on an 
equitable basis by each of the school districts in which the 
enrolled pupils reside; 
    (2) state aid for general education, special education, 
transportation, capital expenditures, community education, adult 
basic and continuing education, grants, and other special 
programs; and 
    (3) federal sources of funding. 
    (f) The council shall consider the educational programs to 
be offered and specify particular state aids that would be 
necessary.  It shall specify from whom and to whom property 
taxes and state aid are to be paid. 
    (g) It shall consider ways to acquire and maintain 
facilities and equipment, including leasing existing facilities 
and equipment. 
    (h) It shall consider administration and staffing needs. 
    (i) It shall consider curriculum needs, including serving 
as a state resource center for Indian education. 
    (j) It shall consider student admission requirements, 
policies, and procedures. 
    (k) It shall consider how and where to provide 
transportation. 
    Subd. 4.  [COUNCIL STAFF AND FACILITIES.] The department of 
education shall provide space within its facilities for council 
meetings.  The department of education, through the Indian 
education section, shall provide support services.  The council 
may contract for or employ professional and nonprofessional 
staff.  The professional staff may be individuals currently 
employed by the state or on leave of absence from a school 
district.  A current employee of a school district who contracts 
with, or is employed by, the council may request an extended 
leave of absence under section 125.60.  The school board must 
grant the leave and Minnesota Statutes, section 125.60, governs 
the rights and duties of the employee and school board.  The 
council may contract with consultants and for legal services, as 
needed. 
    Subd. 5.  [REPORT TO LEGISLATURE.] By December 1, 1988, the 
council shall report its recommendations to the state board of 
education and the education committees of the legislature. 
    Sec. 19.  [APPROPRIATION FOR INDIAN SCHOOL COUNCIL.] 
    There is appropriated from the general fund to the Indian 
school council, $100,000 for fiscal year 1989 for the council to 
perform its duties. 
    For fiscal year 1989 only, a complement of two is 
authorized for the council.  The complement may include one 
full-time professional, one half-time professional, and one 
half-time support staff. 
    Sec. 20.  [APPROPRIATION FOR GRANTS FOR INDIAN TEACHERS.] 
    There is appropriated $71,000 from the general fund to the 
state board of education for fiscal year 1989 for a grant to 
assist American Indian people to become teachers and to provide 
additional education for American Indian teachers.  The state 
board may award a joint grant to the University of Minnesota, 
Duluth, and independent school district No. 709, Duluth, for a 
cooperative program.  To obtain the joint grant, a joint 
application must be submitted to the state board of education.  
The application must be developed with the participation of the 
district parent advisory committee, established according to 
Minnesota Statutes, section 126.51, and the Indian advisory 
committee at the University of Minnesota, Duluth.  
    The application must set forth the in-kind services to be 
provided by the University of Minnesota, Duluth.  The 
coordination and mentorship services to be provided by grants to 
the University of Minnesota, Duluth, and independent school 
district No. 709 must also be set forth in the application.  It 
must contain recommended criteria for selecting individual 
scholarship recipients and criteria for scholarship amounts, 
that may include tuition, fees, books, and living expenses for 
ten months.  The portion of the scholarship attributable to 
living expenses may be in the form of a loan to be forgiven if 
the recipient teaches in independent school district No. 709, 
Duluth, for five years.  If, however, the recipient is placed on 
unrequested leave of absence by independent school district No. 
709, Duluth, the loan may be forgiven if the recipient teaches 
in another Minnesota school district for an amount of time that, 
when added to the amount of time taught in Duluth, equals five 
years.  The loan forgiveness program must be developed in 
consultation with the higher education coordinating board.  
    Only the following American Indian people may receive 
scholarships:  
    (1) students entering the University of Minnesota, Duluth, 
who intend to become teachers in Minnesota; 
    (2) teacher aides who are employees of independent school 
district No. 709, Duluth, and who intend to obtain a teaching 
license; and 
    (3) licensed employees of independent school district No. 
709 who begin a master of education program.  
    The joint application shall be submitted to the Minnesota 
Indian scholarship committee for review and comment. 
    The state board may award a joint grant in the amount it 
determines appropriate.  Scholarship money shall be included in 
the amount of the joint grant. 
    Sec. 21.  [1987 SPECIAL EDUCATION DEFICIENCY.] 
    $6,000,000 is appropriated from the general fund to the 
department of education for fiscal year 1988 for the deficiency 
in the amount appropriated for special education for fiscal year 
1987 by Laws 1985, First Special Session chapter 12, article 3, 
section 28, subdivision 2.  The department of education shall 
reduce the amount of the levy certified by 1988 each school 
district, according to Minnesota Statutes, section 275.125, 
subdivision 8c, for special education by the amount that the 
district will receive as a result of this appropriation.  The 
department of education must not consider this appropriation 
when allocating excess appropriations for fiscal year 1987 under 
Minnesota Statutes, section 124.17, subdivision 7. 
    Sec. 22.  [REPEALER.] 
    Minnesota Statutes 1986, section 126.51, subdivision 3, is 
repealed. 
    Sec. 23.  [EFFECTIVE DATE.] 
    Section 9 and 21 are effective the day following final 
enactment.  The provisions of section 9 relating to placing a 
teacher on unrequested leave of absence apply to contracts 
entered into after the effective date of section 9. 

                               ARTICLE 4 

                          COMMUNITY EDUCATION 
    Section 1.  Minnesota Statutes 1986, section 121.88, is 
amended by adding a subdivision to read: 
    Subd. 9.  [COMMUNITY SERVICE PROGRAMS.] A school board may 
offer, as part of a community education program, a community 
service program for public school pupils for the purpose of 
promoting active citizenship and addressing community needs 
through youth service.  The community education advisory council 
shall design the service program in cooperation with the 
district planning, evaluating and reporting committee and local 
organizations that train volunteers or need volunteers' 
services.  Programs must include: 
    (1) preliminary training for pupil volunteers conducted, 
when possible, by organizations experienced in such training; 
    (2) supervision of the pupil volunteers to ensure 
appropriate placement and adequate learning opportunity; 
    (3) sufficient opportunity for pupil volunteers to give 
genuine service to their community; and 
    (4) integration of academic learning with the service 
experience. 
    Examples of appropriate pupil service placements include: 
child care, Head Start, early childhood education, and extended 
day programs; tutoring programs involving older pupils tutoring 
younger pupils; environmental beautification projects; and 
regular visits for shut-in senior citizens. 
    Sec. 2.  Minnesota Statutes 1986, section 121.88, is 
amended by adding a subdivision to read: 
    Subd. 10.  [EXTENDED DAY PROGRAMS.] A school board may 
offer, as part of a community education program, an extended day 
program for children from kindergarten through grade six for the 
purpose of expanding students' learning opportunities.  A 
program must include the following: 
    (1) adult supervised programs while school is not in 
session; 
    (2) parental involvement in program design and direction; 
    (3) partnerships with the K-12 system, and other public, 
private, or nonprofit entities; and 
    (4) opportunities for trained secondary school pupils to 
work with younger children in a supervised setting as part of a 
community service program. 
    The district may charge a sliding fee based upon family 
income for extended day programs.  The district may receive 
money from other public or private sources for the extended day 
program.  The board shall develop standards for school age child 
care programs. 
    Sec. 3.  [129B.48] [PREKINDERGARTEN CHILD DEVELOPMENT 
GRANTS.] 
    Subdivision 1.  [ESTABLISHMENT.] A grant program is 
established for prekindergarten child development programs. 
    Subd. 2.  [ELIGIBLE CHILD.] An eligible child is a child 
who: 
    (1) is at least three years old but has not entered 
kindergarten; 
    (2) resides in a family having a pre-tax income, for the 12 
months before enrollment in the program, at or below the poverty 
level as determined by the federal government; and 
    (3) has a significant delay in the development of any of 
the following areas:  emotional, cognitive, language, 
physical-motor, or social. 
    Subd. 3.  [ELIGIBLE PROGRAMS.] A project head start agency, 
school district, group of districts, and nonprofit organizations 
are eligible for grants.  To be eligible for a grant, all 
children in the program must meet the requirements of 
subdivision 2, clause (1), and at least 90 percent must meet the 
requirements of subdivision 2.  
    Subd. 4.  [CRITERIA AND PROCEDURES.] The state board of 
education shall establish criteria and procedures to select 
recipients of grants.  Criteria for recipients, other than head 
start agencies, must include at least the following: 
    (1) adequate procedures to assess the developmental delay 
of children, according to subdivision 2, clause (3); 
    (2) conformance to the federal guidelines for project head 
start agencies, to the extent practicable; 
    (3) substantial involvement and education of the parents of 
the children; 
    (4) a plan for coordination with local organizations that 
serve young children; 
    (5) a local advisory board; and 
    (6) an evaluation plan. 
    Subd. 5.  [GRANT AWARDS.] The state board may award grants 
for programs that meet the requirements of this section.  Grants 
must be awarded to applicants located in different parts of the 
state.  The board shall give priority in awarding grants to 
those applicants located in areas where no service is available 
within 30 minutes of eligible children's residences.  A 
recipient must not use the grant money to supplant money or 
services available from other sources. 
    Sec. 4.  [APPROPRIATION; PREKINDERGARTEN CHILD DEVELOPMENT 
PROGRAM GRANTS.] 
    There is appropriated from the general fund to the 
department of education for grants for prekindergarten child 
development programs $500,000 for the fiscal year ending June 
30, 1989. 

                               ARTICLE 5

                           EDUCATION AGENCIES'

                             APPROPRIATIONS
    Section 1.  [121.203] [HEALTH-RELATED PROGRAMS.] 
    Subdivision 1.  [AIDS PROGRAM.] The commissioner of 
education, in consultation with the commissioner of health, 
shall assist districts in developing and implementing a program 
to prevent and reduce the risk of acquired immune deficiency 
syndrome.  Each district shall have a program that includes at 
least: 
    (1) planning materials, guidelines and other technically 
accurate and updated information; 
    (2) a comprehensive, technically accurate and updated 
curriculum; 
    (3) cooperation and coordination among districts and ECSUs; 
    (4) a targeting of adolescents, especially those who may be 
at high risk of contracting AIDS, for prevention efforts; 
    (5) involvement of parents and other community members; 
    (6) in-service training for appropriate district staff and 
school board members; 
    (7) collaboration with state agencies and organizations 
having an AIDS prevention or AIDS risk reduction program; 
    (8) collaboration with local community health services, 
agencies and organizations having an AIDS prevention or AIDS 
risk reduction program; and 
    (9) participation by state and local student organizations. 
    The department may provide assistance at a neutral site to 
a nonpublic school participating in a district's program.  
District programs must not conflict with the health and wellness 
curriculum developed under Laws 1987, chapter 398, article 5, 
section 2, subdivision 7. 
    If a district fails to develop and implement a program to 
prevent and reduce the risk of AIDS, the department shall assist 
the ECSU in the region serving that district to develop or 
implement the program. 
    Subd. 2.  [FUNDING SOURCES.] Districts may accept funds for 
AIDS programs developed and implemented under this section from 
public and private sources including public health funds and 
foundations, department professional development funds, federal 
block grants or other federal or state grants. 
    Sec. 2.  Laws 1987, chapter 398, article 5, section 2, 
subdivision 12, is amended to read: 
    Subd. 12.  [COMPREHENSIVE ARTS PLANNING PROGRAM.] For 
technical assistance for the comprehensive arts planning program 
according to Minnesota Statutes, section 129B.21, there is 
appropriated:  
    $37,500 ..... 1988, 
    $37,500 ..... 1989. 
    Any unexpended fund balance remaining from the 
appropriations in this subdivision for 1988 does not cancel and 
is available for the second year of the biennium. 
    Sec. 3.  [REGIONAL PUBLIC LIBRARY DISTRICT 
RECOMMENDATIONS.] 
    By December 1, 1988, the department of education, in 
consultation with the department of revenue, shall make 
recommendations to the governor and the legislature about the 
organization, financing, and formation of regional public 
library districts.  
    Sec. 4.  [MINNESOTA ACADEMIC EXCELLENCE FOUNDATION.] 
    Beginning in fiscal year 1990, the Minnesota academic 
excellence foundation shall arrange funding for the unreimbursed 
travel expenses of school districts participating in the 
national portion of the bicentennial competition on the 
constitution and bill of rights. 
    Sec. 5.  [INFORMATION ON CATEGORICAL PROGRAMS.] 
    By January 15, 1989, the department of education shall 
provide to the education committees of the legislature 
information on how school districts have allocated the revenue 
reserved for categorical programs under Minnesota Statutes 1987 
Supplement, section 124A.27.  This information is to include a 
list of categorical programs that have been funded and the 
amount of additional resources that have been allocated for 
categorical programs compared to funding for these categorical 
programs in previous years. 
    Sec. 6.  [CARRYOVER FOR MINNESOTA SCHOOL AND RESOURCE 
CENTER FOR THE ARTS.] 
    An unexpended balance from the appropriation for the 
Minnesota school and resource center for the arts in Laws 1987, 
chapter 398, article 10, section 4, for fiscal year 1988 does 
not cancel but is available for fiscal year 1989. 
    Sec. 7.  [EDUCATIONAL EFFECTIVENESS.] 
    The department of education shall allocate from its 
available state, federal, and other funding sources $250,000 for 
staff and support to increase services for educational 
effectiveness programs according to Minnesota Statutes, sections 
121.608 and 121.609.  The department complement in the staff 
development unit of the division of instruction is increased by 
one professional position and one clerical position for these 
purposes.  The department shall report on the funding sources 
used for this program to the chairs of the education committees 
of the house and senate and to the department of finance by 
November 1, 1988. 
    Sec. 8.  [HIGHER EDUCATION COORDINATING BOARD; 
APPROPRIATION.] 
    $30,000 is appropriated from the general fund to the higher 
education coordinating board for fiscal year 1989 to support the 
activities of the task force on instructional technology 
established in Laws 1987, chapter 401, section 35. 
   This appropriation is in addition to the amount 
appropriated by Laws 1987, chapter 401, section 2, subdivision 2.
    Sec. 9.  [DEPARTMENT OF EDUCATION; APPROPRIATION.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] There is 
appropriated from the general fund to the department of 
education the sums indicated in this section for the fiscal 
years ending June 30 in the years designated. 
    Subd. 2.  [SECONDARY VOCATIONAL RESTRUCTURING.] For 
developing a restructured secondary vocational model, there is 
appropriated: 
    $100,000 ..... 1988. 
    This appropriation is in addition to the amount 
appropriated by Laws 1987, chapter 398, article 10, section 2, 
subdivision 2 and is available until June 30, 1989. 
    The commissioner of education, in consultation with the 
state director of vocational technical education, the executive 
director of the state council on vocational technical education, 
the chair of the University of Minnesota department of 
vocational and technical education, and the joint council of 
vocational teacher educators, shall develop a restructured model 
for the delivery of secondary vocational education.  The model 
must designate various forms of curriculum that will incorporate 
basic skills education and instruction in higher order thinking 
skills into secondary vocational programs.  The model must 
insure articulation of programs between secondary and 
post-secondary programs. 
    The commissioner may contract for temporary staff to 
develop the restructured model.  The contracts are not subject 
to the contract approval procedures of the commissioner of 
administration or Minnesota Statutes, chapter 16B.  In 
developing the model, the commissioner shall provide for active 
participation by secondary and post-secondary vocational 
technical teachers, vocational teacher educators, special needs 
staff, general education teachers, school counselors, school 
administrators, and representatives of business, industry, and 
labor.  By December 1, 1988, the commissioner shall report to 
the governor and the education committees of the legislature 
about the model and the plans and recommendations for 
implementation. 
    Subd. 3.  [EMERGING USES OF TECHNOLOGY.] For collection and 
dissemination of information on emerging uses of technologies in 
education, there is appropriated: 
    $20,000 ..... 1989. 
    Subd. 4.  [COMPUTER USE BY TEACHERS.] For collection and 
dissemination of information on usage of computers by teachers, 
there is appropriated: 
    $30,000 ..... 1989. 
    Subd. 5.  [PER ASSISTANCE.] For assistance to regions and 
districts with their planning, evaluating and reporting process 
under Minnesota Statutes, section 126.664, there is appropriated:
    $60,000 ..... 1989. 
    Subd. 6.  [AIDS PROGRAM.] For a program to prevent and 
reduce the risk of AIDS, there is appropriated: 
    $900,000 ..... 1989. 
    The appropriation is in addition to the amount appropriated 
by Laws 1987, chapter 398, article 10, section 2, subdivision 2. 
    Up to $50,000 of this appropriation is for an independent 
evaluation of the AIDS program. 
    The department may use a portion of the appropriation for 
technology programs that provide individualized instruction 
about AIDS. 
    The complement of the department is increased by one 
professional and one clerical position until June 30, 1991. 
    The department may contract for noncomplement unclassified 
staff for the period of time necessary to implement the AIDS 
program. 
    Subd. 7.  [TEACHER LICENSING.] For teacher licensing, 
according to Minnesota Statutes, section 125.08, there is 
appropriated: 
    $80,000 ..... 1988. 
    The $80,000 is available to reimburse costs in both years 
of the biennium. 
    This sum is added to the sum appropriated in Laws 1987, 
chapter 398, article 10, section 2, subdivision 2. 
    Subd. 8.  [EDUCATIONAL SERVICES.] For educational services, 
there is appropriated:  
    $250,000 ..... 1989.  
    This sum is added to the sum appropriated in Laws 1987, 
chapter 398, article 10, section 2, subdivision 2. 
    Subd. 9.  [BASIC SKILLS EVALUATION.] To begin a 
comprehensive outside evaluation of literacy systems, there is 
appropriated:  
    $75,000 ..... 1989. 
    This appropriation is contingent upon the department's 
receipt of $1 from private sources for each $2 of this 
appropriation.  The commissioner of education must certify 
receipt of the private matching funds.  The appropriation shall 
be used to begin developing a comprehensive evaluation system 
for basic skills programs.  The department must contract with an 
entity that is not connected to a delivery system. 
    Subd. 10.  [GED ON TV.] For statewide purchase of broadcast 
costs, publicity, and coordination of the GED on TV series, 
there is appropriated: 
    $100,000 ..... 1989. 
    Subd. 11.  [METROPOLITAN OPEN ENROLLMENT.] For 
implementation of open enrollment in the metropolitan area, 
there is appropriated: 
    $150,000 ..... 1989. 
    The complement of the department of education is increased 
by one professional and .5 clerical position for this purpose.  
    The department of education shall ensure that information 
about opportunities for families under the open enrollment 
program is made available to families residing in urban and 
suburban school districts.  The information must include at 
least:  opportunities to enroll in urban and suburban districts; 
programs that are available; procedures and timelines to enroll 
in nonresident districts; and policies of the districts.  To 
educate and encourage families to the maximum extent possible, 
the department may disseminate information, provide assistance 
to individual families, provide supportive services for pupils 
and families, and provide assistance to districts and district 
staff. 
    Sec. 10.  [STATE BOARD; APPROPRIATION.] 
    For a comprehensive study of desegregation and integration 
costs, there is appropriated from the general fund to the state 
board of education: 
    $75,000 ..... 1988. 
An unencumbered balance in fiscal year 1988 does not cancel and 
is available for fiscal year 1989. 
    The state board shall contract for a comprehensive study on 
the desegregation and integration costs for fiscal years 1988 
and 1989 and for the estimated costs for future years.  The 
board must contract with outside consultants experienced in 
program and financial auditing related to desegregation and 
integration. 
    The integration study must identify at least:  (1) the 
costs attributable to implementing each district's desegregation 
plan; (2) the minimum costs necessary to comply with state board 
desegregation rules; and (3) the costs that would occur if the 
district were not required to comply with state board 
desegregation rules.  The study must determine the overlap in 
revenues and expenditures among desegregation revenue, 
integration revenue, and state and federal compensatory 
education revenue.  The study must include district and building 
level analysis, with per student costs and staffing ratios 
provided where appropriate. 
    Selection of a consultant and determination of methodology 
must occur by June 1, 1988, in consultation with the Duluth, 
Minneapolis, and St. Paul school districts. 
    The state board shall submit recommendations for financing 
desegregation and integration costs and programs, including 
options for a uniform allocation method or formula as opposed to 
a program budgeting approach.  The board shall report to the 
governor, the three districts, and the education committees of 
the legislature by November 30, 1988. 
    Sec. 11.  [EFFECTIVE DATE.] 
    Sections 2, 6, 9, and 10 are effective the day following 
final enactment. 

                               ARTICLE 6 

                       OTHER EDUCATIONAL FUNDING 
    Section 1.  Minnesota Statutes 1986, section 120.06, is 
amended by adding a subdivision to read: 
    Subd. 3.  [PUPILS, AT LEAST 21 YEARS OF AGE.] In addition 
to those admitted under subdivision 1, admission to a public 
secondary school is free to a person who is eligible under this 
subdivision.  In order to be eligible, a person must be: 
    (1) at least 21 years of age; 
    (2) a resident of the district where the secondary school 
is located; and 
    (3) eligible under section 126.22, subdivision 2. 
    Free admission is limited to two school years or the 
equivalent, or until the pupil completes the courses required to 
graduate, whichever is less. 
    Sec. 2.  Minnesota Statutes 1987 Supplement, section 
120.17, subdivision 1, is amended to read:  
    Subdivision 1.  [SPECIAL INSTRUCTION FOR HANDICAPPED 
CHILDREN.] Every district shall provide special instruction and 
services, either within the district or in another district, for 
handicapped children who are residents of the district and who 
are handicapped as set forth in section 120.03.  Special 
instruction and services must be provided from birth until 
September 1 after the handicapped child becomes 21 years old but 
shall not extend beyond secondary school or its equivalent, 
except as provided in section 126.22, subdivision 2.  Local 
health, education, and social service agencies shall refer 
children under age five who are known to need or suspected of 
needing special instruction and services to the school district. 
Districts with less than the minimum number of eligible 
handicapped children as determined by the state board shall 
cooperate with other districts to maintain a full range of 
programs for education and services for handicapped children.  
This subdivision does not alter the compulsory attendance 
requirements of section 120.10. 
    Sec. 3.  Minnesota Statutes 1987 Supplement, section 
122.91, is amended by adding a subdivision to read:  
    Subd. 7.  [REVENUE.] An education district may be eligible 
for revenue under section 10.  
    Sec. 4.  Minnesota Statutes 1986, section 123.351, is 
amended by adding a subdivision to read:  
    Subd. 10.  [REVENUE.] A secondary vocational cooperative 
may be eligible for revenue under section 11.  
    Sec. 5.  Minnesota Statutes 1986, section 123.3514, is 
amended by adding a subdivision to read: 
    Subd. 6b.  [FINANCIAL ARRANGEMENTS, PUPILS AGE 21 OR OVER.] 
At the end of each school year, the department of education 
shall pay the tuition reimbursement amount to the post-secondary 
institutions for courses taken to fulfill high school graduation 
requirements by pupils eligible for adult high school graduation 
aid.  The amount of the tuition reimbursement equals the lesser 
of:  
    (1) the actual costs of tuition, textbooks, materials, and 
fees directly related to the course or program taken by the 
pupil; or 
    (2) an amount equal to the difference between the adult 
high school graduation aid attributable to that pupil and an 
amount computed by multiplying the adult high school graduation 
aid by the ratio of the total number of hours that the pupil is 
enrolled in courses in the secondary school during the regular 
school year over the total number of secondary instructional 
hours per pupil in that pupil's resident district.  
    The amount of tuition reimbursement paid for each pupil 
shall be subtracted from the adult high school graduation aid 
paid to the pupil's resident district.  If a pupil is enrolled 
in a course for post-secondary credit, the school district shall 
include the pupil in average daily membership as computed under 
section 120.17, subdivision 1 only for the portion of time 
during which the pupil is enrolled in courses at the secondary 
school and enrolled in courses at the post-secondary institution 
for secondary credit.  
    The department must not pay any tuition reimbursement or 
other costs of a course taken for post-secondary credit only. 
    Sec. 6.  Minnesota Statutes 1986, section 124.17, is 
amended by adding a subdivision to read: 
    Subd. 2e.  [AVERAGE DAILY MEMBERSHIP, PUPILS AGE 21 OR 
OVER.] The average daily membership for pupils age 21 or over, 
is equal to the ratio of the number of yearly hours that the 
pupil is in membership to the number of instructional hours in 
the district's regular school year.  
    Sec. 7.  Minnesota Statutes 1986, section 124.214, 
subdivision 2, is amended to read:  
    Subd. 2.  [ABATEMENTS.] Whenever by virtue of chapter 278, 
sections 270.07, 375.192, or otherwise, the assessed valuation 
of any school district for any taxable year is changed after the 
taxes for that year have been spread by the county auditor and 
the mill rate as determined by the county auditor based upon the 
original assessed valuation is applied upon the changed 
valuations, the county auditor shall, prior to February 1 of 
each year, certify to the commissioner of education the amount 
of any resulting net revenue loss that accrued to the school 
district during the preceding year.  In August of Each year, the 
commissioner shall pay an abatement adjustment to the district 
in an amount calculated according to the provisions of this 
subdivision.  This amount shall be deducted from the amount of 
the levy authorized by section 275.48.  The abatement adjustment 
shall be recognized as revenue in the fiscal year in which it is 
received.  The amount of the abatement adjustment shall be the 
product of:  
    (1) the net revenue loss as certified by the county 
auditor, times 
    (2) the ratio of:  
    (a) the sum of the amounts of the district's certified levy 
in the preceding October according to the following:  
    (i) sections 124A.03, subdivision 1, 124A.06, subdivision 
3a, and 124A.08, subdivision 3a, section 124A.23 if the district 
is entitled to basic foundation receives general education aid 
according to that section 124A.02;  
    (ii) section 124A.10, subdivision 3a, if the district is 
entitled to third tier aid according to section 124A.10, 
subdivision 4;  
    (iii) sections 124A.12, subdivision 3a, and 124A.14, 
subdivision 5a, if the district is eligible for fourth tier aid 
according to section 124A.12, subdivision 4;  
    (iv) sections 124A.03, subdivision 4, and 275.125, 
subdivision 2j, if the district is entitled to summer school aid 
according to section 124.201; and 
    (v) (ii) section 275.125, subdivisions 5 and 5c, if the 
district is entitled to receives transportation aid according to 
section 124.225, subdivision 8a;  
    (iii) section 124.244, if the district receives capital 
expenditure aid according to that section; 
    (iv) section 275.125, subdivision 11c, if the district 
receives hazardous substance aid according to section 124.245; 
    (v) section 275.125, subdivision 8, clauses (a) and (b), if 
the district receives community education aid according to 
section 124.271; 
    (vi) section 275.125, subdivision 8b, if the district 
receives early childhood family education aid according to 
section 124.2711; and 
    (vii) section 275.125, subdivision 6f, if the district 
receives exceptional need aid according to section 124.217; 
    (b) to the total amount of the district's certified levy in 
the preceding October pursuant to sections 124A.03, 124A.06, 
subdivision 3a, 124A.08, subdivision 3a, 124A.10, subdivision 
3a, 124A.12, subdivision 3a, 124A.14, subdivision 5a, and 
275.125, plus or minus auditor's adjustments.  
    Sec. 8.  Minnesota Statutes 1987 Supplement, section 
124.214, subdivision 3, is amended to read:  
    Subd. 3.  [EXCESS TAX INCREMENT.] If a return of excess tax 
increment is made to a school district pursuant to section 
469.176, subdivision 2, or upon decertification of a tax 
increment district, the school district's aid entitlements and 
levy limitations must be adjusted for the fiscal year in which 
the excess tax increment is paid under the provisions of this 
subdivision. 
    (a) An amount must be subtracted from the school district's 
aid for the current fiscal year equal to the product of: 
    (1) the amount of the payment of excess tax increment to 
the school district, times 
    (2) the ratio of: 
    (A) the sum of the amounts of the school district's 
certified levy for the fiscal year in which the excess tax 
increment is paid according to the following: 
    (i) sections 124A.03, subdivision 1, 124A.06, subdivision 
3a, and 124A.08, subdivision 3a, section 124A.23 if the school 
district is entitled to basic foundation receives general 
education aid according to that section 124A.02; 
    (ii) sections 124A.10, subdivision 3a, and 124A.20, 
subdivision 2, if the school district is entitled to third-tier 
aid according to section 124A.10, subdivision 4; 
    (iii) sections 124A.12, subdivision 3a, and 124A.14, 
subdivision 5a, if the school district is eligible for 
fourth-tier aid according to section 124A.12, subdivision 4; 
    (iv) section 124A.03, subdivision 4, if the school district 
is entitled to summer school aid according to section 124.201; 
and 
    (v) (ii) section 275.125, subdivisions 5 and 5c, if the 
school district is entitled to receives transportation aid 
according to section 124.225, subdivision 8a; 
    (iii) section 124.244, if the district receives capital 
expenditure aid according to that section; 
    (iv) section 275.125, subdivision 11c, if the district 
receives hazardous substance aid according to section 124.245; 
    (v) section 275.125, subdivision 8, clauses (a) and (b), if 
the district receives community education aid according to 
section 124.271; 
    (vi) section 275.125, subdivision 8b, if the district 
receives early childhood family education aid according to 
section 124.2711; and 
    (vii) section 275.125, subdivision 6f, if the district 
receives exceptional need aid according to section 124.217; 
    (B) to the total amount of the school district's certified 
levy for the fiscal year pursuant to sections 124A.03, 124A.06, 
subdivision 3a, 124A.08, subdivision 3a, 124A.10, subdivision 
3a, 124A.12, subdivision 3a, 124A.14, subdivision 5a, 124A.20, 
subdivision 2, and 275.125, plus or minus auditor's adjustments. 
    (b) An amount must be subtracted from the school district's 
levy limitation for the next levy certified equal to the 
difference between: 
    (1) the amount of the distribution of excess increment, and 
    (2) the amount subtracted from aid pursuant to clause (a). 
    If the aid and levy reductions required by this subdivision 
cannot be made to the aid for the fiscal year specified or to 
the levy specified, the reductions must be made from aid for 
subsequent fiscal years, and from subsequent levies.  The school 
district shall use the payment of excess tax increment to 
replace the aid and levy revenue reduced under this subdivision. 
    This subdivision applies only to the total amount of excess 
increments received by a school district for a calendar year 
that exceeds $25,000. 
    Sec. 9.  [124.261] [ADULT HIGH SCHOOL GRADUATION AID.] 
    Adult high school graduation aid for eligible pupils age 21 
or over, equals an allowance of 65 percent of the general 
education formula allowance times the average daily membership 
under section 124.17, subdivision 2e.  Adult high school 
graduation aid must be paid in addition to any other aid to the 
district.  Average daily membership of eligible pupils must not 
be used in the computation of pupil units under section 124.17, 
subdivision 1, for any purpose other than the computation of 
adult high school graduation aid. 
    Sec. 10.  [124.2721] [EDUCATION DISTRICT REVENUE.] 
    Subdivision 1.  [ELIGIBILITY.] An education district is 
eligible for education district revenue if the department 
certifies that it meets the requirements of section 122.91, 
subdivisions 3 and 4.  The pupil units of a district that is a 
member of intermediate district No. 287, 916, or 917 may not be 
used to obtain revenue under this section.  The pupil units of a 
district may not be used to obtain revenue under this section 
and section 11.  
    Subd. 2.  [REVENUE.] Education district revenue is $60 per 
actual pupil unit in each district that is a member of an 
education district.  
    Subd. 3.  [LEVY.] To obtain education district revenue, an 
eligible education district may levy the lesser of its education 
district revenue or the amount raised by 1.3 mills times the 
adjusted assessed valuation of each participating district for 
the preceding year.  Each year, the education district board 
shall certify to the county auditor or county auditors the 
amount of taxes to be levied under this section. 
    Subd. 4.  [AID.] The aid for an education district equals 
its education district revenue minus its education district 
levy, times the ratio of the actual amount levied to the 
permitted levy.  
    Subd. 5.  [USES OF REVENUE.] Education district revenue 
must be used by the education district board to provide 
educational programs according to the agreement adopted by the 
education district board, as required by section 122.94.  
    Sec. 11.  [124.575] [SECONDARY VOCATIONAL COOPERATIVE 
REVENUE.] 
    Subdivision 1.  [ELIGIBILITY.] A secondary vocational 
cooperative established under section 123.351 is eligible for 
secondary vocational cooperative revenue if it meets the size 
requirements specified in section 122.96, subdivision 3, and the 
cooperative offers programs authorized under section 123.351, 
subdivision 4, paragraph (b), clause (1), and clause (2) or 
(3).  The pupil units of a district that is a member of 
intermediate school district No. 287, 916, or 917 may not be 
used to obtain revenue under this section.  The pupil units of a 
district may not be used to obtain revenue under this section 
and section 10.  
    Subd. 2.  [REVENUE.] Secondary vocational cooperative 
revenue is $20 per actual pupil unit in the participating school 
districts of a secondary vocational cooperative.  
    Subd. 3.  [LEVY.] To obtain secondary vocational 
cooperative revenue, an eligible secondary vocational 
cooperative may levy the lesser of its secondary vocational 
cooperative revenue or the amount raised by .4 mills times the 
adjusted assessed valuation of each member district for the 
preceding year.  Each year, the secondary vocational cooperative 
board must certify the amount of taxes to be levied under this 
section to the county auditor or county auditors.  
    Subd. 4.  [AID.] The aid for a secondary vocational 
cooperative equals its secondary vocational cooperative revenue 
minus its secondary vocational cooperative levy, times the ratio 
of the actual amount levied to the permitted levy.  
    Sec. 12.  Minnesota Statutes 1987 Supplement, section 
126.22, subdivision 2, is amended to read:  
    Subd. 2.  [ELIGIBLE STUDENTS PUPILS.] The 
following students pupils are eligible to participate in the 
high school graduation incentives program: 
    (a) any student pupil who is between the ages of 12 and 16 
and who: 
    (1) is at least two grade levels below the performance 
level for students pupils of the same age in a locally 
determined achievement test; or 
    (2) is at least one year behind in obtaining credits for 
graduation; or 
    (3) is pregnant or is a parent; or 
    (4) has been assessed as chemically dependent; or 
    (5) has been absent from attendance at school without 
lawful excuse for one or more class periods on more than 15 
consecutive school days in the preceding or current school year; 
    (b) any student pupil who is between the ages of 16 and 19 
who is attending school, and who is at least two grade levels 
below the performance level for students pupils of the same age 
in a locally determined achievement test, or is at least one 
year behind in obtaining credits for graduation, or is pregnant 
or is a parent, or has been assessed as chemically dependent; or 
    (c) any person between 16 and 21 years of age who has not 
attended a high school program for at least 15 consecutive 
school days, excluding those days when school is not in session, 
and who is at least two grade levels below the performance level 
for students pupils of the same age in a locally determined 
achievement test, or is at least one year behind in obtaining 
credits for graduation, or has been assessed as chemically 
dependent; or 
    (d) any person who is at least 21 years of age and who: 
    (1) has received less than 14 years of public or nonpublic 
education, beginning at age 5; 
    (2) has already completed the studies ordinarily required 
in the 10th grade but has not completed the requirements for a 
high school diploma or the equivalent; and 
    (3) at the time of application, (i) is eligible for 
unemployment compensation benefits or has exhausted the 
benefits, (ii) is eligible for or is receiving income 
maintenance and support services, as defined in section 
268.0111, subdivision 5, or (iii) is eligible for services under 
the displaced homemaker program, state wage-subsidy program, or 
any programs under the federal Jobs Training Partnership Act or 
its successor. 
    Notwithstanding section 127.27, subdivision 7, the 
provisions of section 127.29, subdivision 1, do not apply to 
pupils age 17 and older who participate in the high school 
graduation incentives program. 
    Sec. 13.  Minnesota Statutes 1987 Supplement, section 
126.22, subdivision 3, is amended to read:  
    Subd. 3.  [ELIGIBLE PROGRAMS.] Students Pupils who are 
eligible to participate under subdivision 2 may enroll in the 
following programs: 
    (a) Any program approved by the state board of education 
under Minnesota Rules, part 3500.3500, including area learning 
centers under sections 129B.52 to 129B.55, or according to 
section 121.11, subdivision 12, may enroll students pupils who 
are eligible to participate under subdivision 2, clause (a), (b) 
or, (c), or (d); 
    (b) Students Pupils eligible to participate under 
subdivision 2, clause (b) or, (c), or (d) may enroll in 
secondary school courses upon a resolution passed by a school 
board approving enrollment, or may enroll in post-secondary 
courses under section 123.3514; and 
    (c) Any public secondary education program may enroll any 
student pupil who is eligible to participate under subdivision 
2, clause (a), (b) or, (c), or (d). 
    An eligible institution providing eligible programs as 
defined in this subdivision may contract with an entity 
providing adult basic education programs under the community 
education program contained in section 121.88 for actual program 
costs. 
    Sec. 14.  Minnesota Statutes 1986, section 129B.20, 
subdivision 1, is amended to read: 
    Subdivision 1.  [FUNDING.] Each site shall receive $1,250 
each year for two years.  If fewer than 30 sites are selected, 
each site shall receive an additional proportionate share of 
money appropriated and not used.  Before receiving money for the 
second year, a long-range plan for arts education must be 
submitted to the department. 
    Sec. 15.  Minnesota Statutes 1987 Supplement, section 
129B.53, subdivision 2, is amended to read:  
    Subd. 2.  [PEOPLE TO BE SERVED.] A center shall provide 
programs for secondary pupils and adults, giving priority to 
serving persons between 16 and 21 years of age.  Secondary 
pupils to be served are those who are chemically dependent, not 
likely to graduate from high school, need assistance in 
vocational and basic skills, can benefit from employment 
experiences, and need assistance in transition from school to 
employment.  Adults to be served are dislocated homemakers and 
workers and others who need basic educational and social 
services.  In addition to offering programs, the center shall 
coordinate the use of other available educational services, 
social services, and post-secondary institutions in the 
community.  The center may also provide programs for elementary 
and secondary pupils who are not attending the center to assist 
them in completing high school. 
    Sec. 16.  Minnesota Statutes 1987 Supplement, section 
136D.27, is amended to read:  
    136D.27 [TAX STATE AIDS AND LEVIES, CERTIFICATES OF 
INDEBTEDNESS.] 
    Subdivision 1.  [LEVIES FOR CERTAIN PROGRAMS.] Each year 
the joint school board may certify to each participating school 
district tax levies that shall not in any year exceed .6 mills 
on each dollar of adjusted assessed valuation for special 
education and .7 mills on each dollar of adjusted assessed 
valuation for expenses for secondary vocational education.  Each 
participating school district shall include such these tax 
levies in the next tax roll which it shall certify to the county 
auditor or auditors, and shall remit the collections of such 
levies to the board promptly when received.  Such These levies 
shall not be included in computing the limitations upon the levy 
of any participating district under sections 124A.03, 124A.06, 
subdivision 3a, 124A.08, subdivision 3a, 124A.10, subdivision 
3a, 124A.12, subdivision 3a, 124A.14, subdivision 5a, and 
275.125.  The board may, any time after such these levies have 
been certified to the participating school districts, issue and 
sell certificates of indebtedness in anticipation of the 
collection of such levies, but in aggregate amounts such as will 
not exceed the portion of the levies which is then not collected 
and not delinquent. 
    Subd. 2.  [PROHIBITED LEVIES.] Notwithstanding section 
136D.24 or any other law to the contrary, the joint school board 
may not certify, either itself, to any participating district, 
or to any cooperating school district, any levies for any 
purpose, except the levies authorized by subdivision 1, sections 
127.05, 275.125, subdivisions 8c and 14a, 275.48, and 475.61, 
and for the joint school board's obligations under section 
268.06, subdivision 25, for which a levy is authorized by 
section 275.125, subdivision 4. 
    Subd. 3.  [PROHIBITED STATE AIDS.] Notwithstanding section 
136D.24 or any law to the contrary, the department of education 
shall not pay, unless explicitly authorized by statute, any 
state aid, grant, credit, or other money to the joint school 
board, except the aid, credit, or money authorized by sections 
121.201, 123.3514, 124.2137, 124.252, 124.32, 124.573, 124.574, 
and 124.646, and chapter 273.  
    Sec. 17.  Minnesota Statutes 1986, section 136D.74, is 
amended by adding a subdivision to read:  
    Subd. 2a.  [PROHIBITED LEVIES.] Notwithstanding 
subdivisions 2 and 4, section 136D.73, subdivision 3, or any 
other law to the contrary, the intermediate school board may not 
certify, either itself, to any participating district, or to any 
cooperating school district, any levies for any purpose, except 
the levies authorized by subdivision 1, sections 127.05, 
275.125, subdivisions 8c and 14a, 275.48, and 475.61, and for 
the intermediate school board's obligations under section 
268.06, subdivision 25, for which a levy is authorized by 
section 275.125, subdivision 4. 
    Sec. 18.  Minnesota Statutes 1986, section 136D.74, is 
amended by adding a subdivision to read:  
    Subd. 2b.  [PROHIBITED STATE AIDS.] Notwithstanding 
subdivision 4 or any law to the contrary, the department of 
education shall not pay, unless explicitly authorized, any state 
aid, grant, credit, or other money to the intermediate school 
board, except the aid, credit, or money authorized by sections 
121.201, 123.3514, 124.2137, 124.252, 124.32, 124.573, 124.574, 
and 124.646, and chapter 273. 
    Sec. 19.  Minnesota Statutes 1987 Supplement, section 
136D.87, is amended to read:  
    136D.87 [TAX LEVIES, CERTIFICATES OF INDEBTEDNESS.] 
    Subdivision 1.  [LEVIES FOR CERTAIN PROGRAMS.] Each year 
the joint school board may certify to each participating school 
district tax levies that shall not in any year exceed .6 mills 
on each dollar of adjusted assessed valuation for expenses for 
special education and .7 mills on each dollar of adjusted 
assessed valuation for expenses for secondary vocational 
education.  Each participating school district shall include 
such these tax levies in the next tax roll which it shall 
certify to the county auditor or auditors and shall remit the 
collections of such these levies to the board promptly when 
received.  Such These levies shall not be included in computing 
the limitations upon the levy of any participating district 
under sections 124A.03, 124A.06, subdivision 3a, 124A.08, 
subdivision 3a, 124A.10, subdivision 3a, 124A.12, subdivision 
3a, 124A.14, subdivision 5a, and 275.125.  The board may, any 
time after such these levies have been certified to the 
participating school districts, issue and sell certificates of 
indebtedness in anticipation of the collection of such levies, 
but in aggregate amounts such as that will not exceed the 
portion of the levies which is then not collected and not 
delinquent. 
    Subd. 2.  [PROHIBITED LEVIES.] Notwithstanding section 
136D.84 or any other law to the contrary, the joint school board 
may not certify, either itself, to any participating district, 
or to any cooperating school district, any levies for any 
purpose, except the levies authorized by subdivision 1, sections 
127.05, 275.125, subdivisions 8c and 14a, 275.48, and 475.61, 
and for the joint school board's obligations under section 
268.06, subdivision 25, for which a levy is authorized by 
section 275.125, subdivision 4. 
    Subd. 3.  [PROHIBITED STATE AIDS.] Notwithstanding section 
136D.24 or any law to the contrary, the department of education 
shall not pay, unless explicitly authorized, any state aid, 
grant, credit, or other money to the joint school board, except 
for aid, credit, or money authorized by sections 121.201, 
123.3514, 124.2137, 124.252, 124.32, 124.573, 124.574, and 
124.646, and chapter 273. 
    Sec. 20.  Minnesota Statutes 1986, section 275.125, is 
amended by adding a subdivision to read:  
    Subd. 6i.  [RULE COMPLIANCE LEVY.] Each year a district 
that is required to implement a plan according to the 
requirements of Minnesota Rules, parts 3535.0200 to 3535.2200, 
may levy an amount not to exceed one mill times the adjusted 
assessed valuation of the district.  Independent school district 
No. 625, St. Paul, may levy according to this subdivision and 
subdivision 6e.  Notwithstanding section 121.904, the entire 
amount of this levy shall be recognized as revenue for the 
fiscal year in which the levy is certified.  This levy shall not 
be considered in computing the aid reduction under section 
124.155.  
    Sec. 21.  Minnesota Statutes 1986, section 275.125, is 
amended by adding a subdivision to read:  
    Subd. 8e.  [INTERDISTRICT COOPERATION LEVY.] This 
subdivision does not apply to special school district No. 1, 
independent school district No. 11, 625, or 709, or to a 
district that is a member of intermediate school district No. 
287, 916, or 917.  A district may levy each year under this 
subdivision if it:  
    (1) is a member of an education district, under sections 
122.91 to 122.96, and the education district of which the 
district is a member does not receive revenue under section 10; 
or 
    (2) has a cooperation agreement with other districts to 
expand curricular offerings in mathematics in grades 10 to 12, 
science in grades 10 to 12, foreign languages for two years, 
computer usage, or other programs recommended by the state board.
    The levy must not exceed the amount raised by one mill 
times the adjusted assessed valuation of the district for the 
preceding year.  A district that is a member of a secondary 
vocational cooperative that levies under section 11, may levy 
the difference between the amount raised by one mill times the 
adjusted valuation of the district for the preceding year and 
the amount levied under section 11.  The proceeds of the levy 
may be used only to pay for instructional and administrative 
costs incurred in providing the curricular offerings under this 
section.  A district may not spend more than five percent of the 
amount of the levy for administration. 
    Sec. 22.  Laws 1987, chapter 398, article 3, section 38, is 
amended to read: 
    Sec. 38.  [COMMISSION SPECIAL EDUCATION STUDY STUDIES.] 
    The sum of $100,000 $250,000 is appropriated for fiscal 
year 1988 from the general fund to the legislative commission on 
public education for the commission to conduct:  (1) a 
comprehensive qualitative and quantitative evaluation and 
analytical study of special education, financing, and related 
services; (2) a study of education accountability measures; and 
(3) an education organization study that includes findings about 
learning opportunities for learners, financial considerations, 
and alternative patterns of educational organization.  The sum 
is available until June 30, 1989. 
    Sec. 23.  [TASK FORCE ON EDUCATION ORGANIZATION.] 
    Subdivision 1.  [ESTABLISHED.] There is established a task 
force on education organization that is composed of 24 members.  
It shall be an advisory task force to the legislative commission 
on public education.  
    Subd. 2.  [MEMBERSHIP.] The legislative commission on 
public education shall appoint 18 members who represent various 
sizes of school districts and geographical areas of the state.  
Each member shall be a person who has knowledge of: 
    (1) the group selecting the person; 
    (2) the day-to-day operations of schools; and 
    (3) the items to be considered by the task force. 
    A person selected by a group is not required to be a member 
of the group.  
    By June 1, 1988, each group shall submit to the chair of 
the legislative commission the names of two people and the 
commission shall select, at random, one of the two people to 
serve on the task force.  Each of the following groups shall be 
represented on the task force:  
    (1) state board of education; 
    (2) state curriculum advisory committee; 
    (3) Minnesota school boards association; 
    (4) association of stable or growing school districts; 
    (5) association of metropolitan school districts; 
    (6) Minnesota rural education association; 
    (7) Minnesota community education association; 
    (8) Minnesota association of school administrators; 
    (9) Minnesota association of secondary vocational 
administrators; 
    (10) Minnesota administrators of special education; 
    (11) Minnesota association of secondary school principals; 
    (12) Minnesota elementary school principals' association; 
    (13) Minnesota education association; 
    (14) Minnesota federation of teachers; 
    (15) Minnesota congress of parents, teachers, and students; 
    (16) independent school district Nos. 11 and 625 and 
special school district No. 1; 
    (17) the business community; and 
    (18) associations representing nonpublic education. 
    In addition, six members of the legislature shall be 
appointed to the task force.  The subcommittee on committees of 
the committee on rules and administration of the senate shall 
appoint three members of the senate.  The speaker of the house 
of representatives shall appoint three members of the house.  
    The commissioner of education, or a designee, shall be an 
ex officio nonvoting member of the task force.  
    The chair of the legislative commission shall convene the 
first meeting of the task force by July 1, 1988.  The task force 
members shall elect the chair of the task force.  
    Subd. 3.  [ITEMS FOR CONSIDERATION.] In considering 
education organization, the task force shall consider and make 
findings about the following:  
    (1) learning opportunities, including, but not limited to: 
    (i) minimum and maximum curricular offerings; 
    (ii) alternatives to traditional instructional time or 
learning year; 
    (iii) state board of education rules; 
    (iv) learning and teaching options; and 
    (v) community education and its implications; 
    (2) financial considerations, including, but not limited to:
    (i) funding and tax equity; 
     (ii) the relationship between educational expenditures and 
student achievement; 
    (iii) implications for employees, including salaries, 
fringe benefits, and collective bargaining; 
    (iv) facility needs, uses, and alternatives, including 
construction of duplicative facilities by adjacent districts; 
and 
    (v) community education and its implications; 
    (3) alternative patterns of organization, including, but 
not limited to: 
    (i) various management organizational structures; 
    (ii) technology use; 
    (iii) incentives to reorganize; 
    (iv) research on education organization; and 
    (v) community education and its implications. 
    Subd. 4.  [SUBCOMMITTEES.] The task force shall appoint at 
least two subcommittees.  One subcommittee shall address 
curriculum and learning opportunities.  One subcommittee shall 
address organizational structures and finance.  The members of 
both subcommittees shall be representative of various sizes of 
school districts and geographical areas of the state.  
    Subd. 5.  [EXPENSES AND EXPIRATION.] The task force shall 
be governed by Minnesota Statutes, section 15.059, subdivision 6.
    Subd. 6.  [STAFF ASSISTANCE.] The education committees of 
the legislature and the department of education shall provide 
staff assistance to the task force and subcommittees.  
    Subd. 7.  [FINDINGS.] The task force shall report its 
findings to the legislative commission by December 1, 1988. 
    Sec. 24.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] There is 
appropriated from the general fund or other named fund to the 
department of education the sums indicated in this section for 
fiscal years ending June 30 in the years designated. 
    Subd. 2.  [HUTCHINSON SCHOOL DISTRICT.] To reimburse 
independent school district No. 423, Hutchinson, for expenses 
actually incurred in participating in the national bicentennial 
competition on the Constitution and Bill of Rights, there is 
appropriated: 
    $12,000 ..... 1988. 
    Subd. 3.  [ADULT HIGH SCHOOL GRADUATION AID.] For adult 
high school graduation aid, there is appropriated:  
     $1,000,000 ..... 1989.  
     If the appropriation is insufficient, the aid must be 
prorated. 
    Subd. 4.  [INTEGRATION GRANTS.] For grants for integration 
expenditures, there is appropriated:  
    $12,013,600 ..... 1989.  
    Grant amounts may not exceed $981,900 for independent 
school district No. 709, Duluth, $5,950,300 for special school 
district No. 1, Minneapolis, and $5,081,400 for independent 
school district No. 625, St. Paul.  As a condition of receiving 
a grant, each district must continue to report its costs 
according to the uniform financial accounting and reporting 
system and must provide the information requested for the state 
board of education study of integration costs.  As a further 
condition of receiving a grant, each district must submit a 
report to the chairs of the education committees of the 
legislature about the actual expenditures it made for 
integration using the grant money. 
    Subd. 5.  [CHISHOLM SCHOOL DISTRICT.] For a grant for a 
leadership program in independent school district No. 695, 
Chisholm, there is appropriated:  
    $20,000 ..... 1989. 
    Subd. 6.  [NORTHEAST MINNESOTA TECHNOLOGY CONSORTIUM.] For 
a grant to the northeast Minnesota technology and education 
consortium to develop a pilot computer technology program, there 
is appropriated: 
    $50,000 ..... 1989. 
    Subd. 7.  [NORTHWEST EDUCATIONAL TECHNOLOGY 
COOPERATIVE.] For a grant to independent school district Nos. 
351, 354, 436, 437, 442, 443, and 446 to develop a cooperative 
educational technology program, there is appropriated:  
    $100,000 ..... 1988. 
    Any unexpended amount does not cancel and is available 
until June 30, 1989.  
    Sec. 26.  [EFFECTIVE DATE.] 
    Sections 22, 23, and 24 are effective the day following 
final enactment.  
    Sections 10, subdivision 4, and 11, subdivision 4, are 
effective for the 1989-1990 school year. 

                               ARTICLE 7

                             MISCELLANEOUS
    Section 1.  Minnesota Statutes 1986, section 92.06, 
subdivision 4, is amended to read:  
    Subd. 4.  [IMPROVEMENTS, WHEN PAYMENT NOT NECESSARY.] If a 
person has made improvements to the land and if the commissioner 
believes that person settled the land in good faith as homestead 
land under the laws of the United States before it was certified 
to the state, or if the improvements were lawfully made by that 
person as a lessee of the state, then the value of the 
improvements must be separately appraised and, if the settler or 
lessee purchases the land, the settler or lessee is not required 
to pay for the improvements.  If another person purchases the 
land, that person must pay the state at the time of sale the 
owner of the improvements, in addition to all other required 
payments, the appraised amount for the improvements.  The amount 
received by the state for the improvements must be paid to the 
settler or lessee or heirs, representatives, or assigns of the 
settler or lessee.  Payment must be made by warrant drawn by the 
commissioner of finance upon the state treasurer.  Amounts 
received for the improvements are appropriated for making the 
payments Payment for improvements must be made within 15 days of 
the auction sale, either in cash or upon terms and conditions 
agreeable to the owner of the improvements.  If payment for 
improvements is not made in cash, and if there is no agreement 
between the parties within 15 days of the auction sale, the 
commissioner may: 
    (1) sell the property to the second highest qualified 
bidder if that bidder submitted to the commissioner's 
representative, at the auction sale, a written request to buy 
the property at a specified price; or 
    (2) void the sale and reoffer the property at a subsequent 
sale. 
    This subdivision does not apply unless the person seeking 
its benefit owner of the improvements makes a verified 
application to the commissioner showing entitlement to it the 
improvements before the first state public sale at which the 
land is offered for sale.  The applicant must appear at the sale 
and offer to purchase the land for at least its appraised value 
including all timber on it, and make the purchase if no higher 
bid is received.  Actions or other proceedings involving the 
land in question begun before the sale must have been completed. 
    Sec. 2.  Minnesota Statutes 1986, section 92.14, is amended 
by adding a subdivision to read: 
    Subd. 3.  [ADDITIONAL ADVERTISING OF LAND SALES.] In 
addition to posted notice of land sales required by subdivisions 
1 and 2, the commissioner shall publicize land sales in 
Minnesota and elsewhere to the greatest extent possible, 
consistent with appropriations available for that purpose. 
    Sec. 3.  Minnesota Statutes 1987 Supplement, section 92.46, 
subdivision 1, is amended to read:  
    Subdivision 1.  [PUBLIC CAMPGROUNDS.] (a) The director may 
designate suitable portions of the state lands withdrawn from 
sale and not reserved, as provided in section 92.45, as 
permanent state public campgrounds.  The director may have the 
land surveyed and platted into lots of convenient size, and 
lease them for cottage and camp purposes under terms and 
conditions the director prescribes, subject to the provisions of 
this section.  
    (b) A lease may not be made for a term more than 20 years.  
The lease may allow renewal, from time to time, for additional 
terms of no longer than 20 years each.  The lease may be 
canceled by the commissioner 90 days after giving the person 
leasing the land written notice of violation of lease 
conditions.  The lease rate shall be based on the appraised 
value of leased land as determined by the commissioner of 
natural resources.  The appraised value shall be the value of 
the leased land without any private improvements and must be 
comparable to similar land without any improvements within the 
same county.  
    (c) By July 1, 1986, the commissioner of natural resources 
shall adopt rules under chapter 14 to establish procedures for 
leasing land under this section.  The rules shall be subject to 
review and approval by the commissioners of revenue and 
administration prior to the initial publication pursuant to 
chapter 14 and prior to their final adoption.  The rules must 
address at least the following: 
    (1) method of appraising the property; 
    (2) determination of lease rates; and 
    (3) an appeal procedure for both the appraised values and 
lease rates. 
    (d) All money received from these leases must be credited 
to the fund to which the proceeds of the land belong.  
    Notwithstanding section 16A.125 or any other law to the 
contrary, 50 percent of the money received from the lease of 
permanent school fund lands leased pursuant to this subdivision 
shall be deposited into the permanent school trust fund.  
However, in fiscal years 1987, 1988, 1989, 1990, 1991, and 1992, 
the money received from the lease of permanent school fund lands 
that would otherwise be deposited into the permanent school fund 
is hereby appropriated to survey, appraise, and pay associated 
selling costs of lots as required in section 92.67, subdivision 
3.  The money appropriated may not be used to pay the cost of 
surveying lots not scheduled for sale.  Any money designated for 
deposit in the permanent school fund that is not needed to 
survey, appraise, and pay associated selling costs of lots, as 
required in section 92.67, shall be deposited in the permanent 
school fund.  The commissioner shall add to the appraised value 
of any lot offered for sale the costs of surveying, appraising, 
and selling the lot, and shall first deposit the costs recovered 
in into the permanent school fund and an amount equal to the 
costs of surveying, appraising, and selling any lot paid out of 
the permanent school fund.  Any remaining money shall be 
deposited into any other contributing funds in proportion to the 
contribution from each fund.  In no case may the commissioner 
add to the appraised value of any lot offered for sale an amount 
more than $700 for the costs of surveying and appraising the 
lot.  Notwithstanding section 92.67, subdivision 4, as to 
requests for sale of lakeshore lots received before January 1, 
1987, the commissioner shall hold the sale before October 31, 
1987, if possible, and, if not possible, the lots shall be 
offered for sale at the next sale in the succeeding year.  
    Sec. 4.  Minnesota Statutes 1987 Supplement, section 92.67, 
subdivision 1, is amended to read:  
    Subdivision 1.  [SALE REQUIREMENT.] Notwithstanding section 
92.45 or any other law, at the request of a lessee or as 
otherwise provided in this section, the commissioner of natural 
resources shall sell state property bordering public waters that 
is leased for the purpose of a private cabin under section 
92.46.  Requests for sale must be made prior to July 1, 1991 
December 31, 1992, and the commissioner shall complete all 
requested sales and sales arising from those requests by July 1, 
1992.  The lessee making the request may designate the lesser of 
$500 or the lease payment in the year the request is made to be 
used as part of the down payment December 31, 1993, subject to 
section 92.67, subdivision 3, clause (d).  The sale shall be 
made in accordance with laws providing for the sale of trust 
fund land except as modified by the provisions of this section.  
    Sec. 5.  Minnesota Statutes 1987 Supplement, section 92.67, 
subdivision 3, is amended to read:  
    Subd. 3.  [APPRAISERS; ALLOCATION OF APPRAISAL AND SURVEY 
COSTS.] (a) The For an appraisal conducted before the effective 
date of this section, a lessee requesting the sale may select a 
person who meets the minimum appraisal standards established by 
the federal Farmers Home Administration or the federal Veterans 
Administration to appraise the property to be sold.  If more 
than one lessee of a cabin site lot leased by the commissioner 
under section 92.46 within a platted area requests the sale of a 
leased lot, all requesting lessees may jointly agree upon an 
appraiser.  If the lessee or lessees do not select an appraiser, 
the commissioner of natural resources shall select the 
appraiser.  An appraisal prepared by a person who meets the 
minimum appraisal standards established by the Farmers Home 
Administration or the federal Veterans Administration, but who 
is not included on the list of appraisers approved by the 
commissioner of administration for the appraisal of state 
property, must be reviewed by an appraiser selected by the 
commissioner of natural resources from the commissioner of 
administration's list of approved appraisers.  If, upon 
conclusion of this review, the commissioner of natural resources 
determines that the appraisal under review does not meet state 
appraisal standards, the commissioner shall reject the appraisal 
and have the property reappraised by an appraiser selected from 
the list approved by the commissioner of administration. 
    For appraisals conducted on and after the effective date of 
this section, all appraisals of lots offered for sale shall be 
performed by persons selected by the commissioner who are 
included on the list of appraisers approved by the commissioner 
of administration for the appraisal of state property.  A lessee 
requesting a sale may recommend to the commissioner a person 
from the approved list to appraise the property to be sold.  The 
commissioner shall supply the approved list to any lessee upon 
request. 
    (b) The costs of appraisal shall be allocated by the 
commissioner to the lots offered for sale and the successful 
bidder on each lot shall reimburse the commissioner for the 
appraisal costs allocated to the lot bid upon up to $700 for 
each lot appraised.  If there are no successful bidders on a 
lot, the commissioner is responsible for the appraisal cost 
allocated to that lot.  
    (c) The commissioner shall survey a lot prior to offering 
it for sale.  The commissioner is responsible for the survey 
cost. 
    (d) The lessee may stop the sale process after the 
appraisal but before the sale.  The lessee must reimburse the 
commissioner for the cost of the appraisal if the sale is 
stopped If a lessee disagrees with the appraised value of the 
lessee's improvements, the lessee may select an appraiser from 
the approved list of appraisers to reappraise the improvements.  
The lessee is responsible for the cost of this reappraisal.  If 
the commissioner and the lessee fail to agree on the value of 
the improvements within 180 days of the date an appraisal is 
performed, the commissioner shall offer the lot for sale at a 
price that incorporates the county assessor's estimated market 
value of the improvements adjusted by the assessment/sales ratio 
as determined by the department of revenue.  
    Sec. 6.  Minnesota Statutes 1987 Supplement, section 92.67, 
subdivision 4, is amended to read:  
    Subd. 4.  [TIMING OF SALES.] (a) The commissioner shall 
offer lakeshore cabin site lots for sale pursuant to written 
request and in accordance with the following schedule:  
    (1) as to requests received before January 1, 1987 1988, 
the sale shall be held not later than by October 31, 1987 1988, 
if possible.  However, if a lot is not offered for sale by that 
date, the lot shall be offered for sale at the next sale in the 
next year; 
    (2) as to requests received each calendar year after 
December 31, 1986 1987, the sale shall be held in June, July, or 
August of the year after the request is received; 
    (3) notwithstanding clause (2), the commissioner may offer 
a lot for sale in the year the request is received if the 
commissioner will offer for sale in that year other lots platted 
with the late requested lot;  
    (4) notwithstanding clause (2), if more than 50 percent of 
the lessees in a platted area request by December 31 of a 
calendar year that their lots be offered for sale, the 
commissioner shall offer for sale at one time during June, July, 
or August of the following year all lots in a platted area.  If 
a lessee, whose lot is located in a plat where more than 50 
percent of the lessees request that their lots be offered for 
sale, requests in writing that the lessee's lot not be offered 
for sale, the commissioner may not offer the lot for sale until 
1993; and 
    (5) lots that are unsold for any reason at the end of 1993 
shall be offered for sale in increments over a period of five 
years beginning in 1994.  Lots that are unsold for any reason at 
the end of 1998 shall be offered for sale in 1999 and each year 
thereafter until sold. 
    (b) The last sales shall be held in 1992.  Lots not sold 
the first year offered may be reoffered in a succeeding year, 
following reappraisal if it is determined necessary by the 
commissioner.  
    (c) If a person other than the lessee purchases the leased 
lakeshore cabin site, the purchaser must make payment in full to 
the lessee at the time of the sale, in the manner provided in 
section 92.06, subdivision 4, for the appraised value of any 
improvements.  Failure of a successful bidder to comply with 
this provision voids the sale and the property must be rebid, if 
possible, at the same sale may be reoffered for sale as provided 
in section 92.06, subdivision 4.  
    Sec. 7.  Minnesota Statutes 1986, section 92.67, 
subdivision 5, is amended to read:  
    Subd. 5.  [TERMS OF SALE.] For the sale of the public lands 
under this section, the purchaser shall pay the state ten 
percent of the purchase price at the time of the sale.  The 
balance must be paid in no more than 20 equal annual 
installments.  The interest rate on the remaining balance shall 
be eight percent per year at the rate in effect at the time of 
the sale under section 549.09. 
    Sec. 8.  [120.062] [ENROLLMENT OPTIONS PROGRAM.] 
    Subdivision 1.  [CERTAIN DISTRICTS EXCLUDED.] For the 
1989-1990 school year only, this section applies to a district 
that has more than 1,000 actual pupil units in kindergarten 
through grade 12.  
    Subd. 2.  [ESTABLISHMENT.] An enrollment options program is 
established to enable any pupil to attend a school or program in 
a district in which the pupil does not reside, subject to the 
limitations in this section.  
    Subd. 3.  [CLOSED DISTRICTS.] A school board may, by 
resolution, determine that nonresident pupils may not attend any 
of its schools or programs according to this section.  
    Subd. 4.  [PUPIL APPLICATION PROCEDURES.] In order that a 
pupil may attend a school or program in a nonresident district, 
the pupil's parent or guardian must submit an application to the 
nonresident district.  The parent or guardian of a pupil 
residing in a district that does not have a desegregation plan 
approved by the state board of education must submit an 
application by January 1 for enrollment during the following 
school year.  The parent or guardian of a pupil residing in a 
district that has a desegregation plan approved by the state 
board of education may apply to a district at any time.  The 
application shall be on a form provided by the department of 
education.  A particular school or program may be requested by 
the parent.  
    Subd. 5.  [DESEGREGATION PLANS.] A district that has a 
desegregation plan approved by the state board of education may 
limit the number of pupils who transfer into or out of the 
district.  To remain in compliance with its desegregation plan, 
the district may establish the number of majority and minority 
group pupils who may transfer into or out of the district.  The 
district may accept or reject applications in a manner that will 
enable compliance with the desegregation plan.  The district 
shall notify the parent or guardian and the resident district 
according to the requirements of subdivision 6.  
    Subd. 6.  [NONRESIDENT DISTRICT PROCEDURES.] Within 60 days 
of receiving an application, a district that does not exclude 
nonresident pupils, according to subdivision 3, shall notify the 
parent or guardian and the resident district in writing whether 
the application has been accepted or rejected.  If an 
application is rejected, the district must state in the 
notification the reason for rejection. 
    Subd. 7.  [BASIS FOR DECISIONS.] The school board must 
adopt, by resolution, specific standards for acceptance and 
rejection of applications.  Standards may include the capacity 
of a program, class, grade level, or school building.  Standards 
may not include previous academic achievement, athletic or other 
extracurricular ability, handicapping conditions, proficiency in 
the English language, or previous disciplinary proceedings.  
    Subd. 8.  [WAIVER OF DEADLINES.] Upon agreement of the 
resident and nonresident school boards, if applicable, the 
deadlines in subdivisions 4 and 6 may be waived. 
    Subd. 9.  [TRANSPORTATION.] If requested by the parent of a 
pupil, the nonresident district shall provide transportation 
within the district.  The state shall pay transportation aid to 
the district according to section 124.225.  
    The resident district is not required to provide or pay for 
transportation between the pupil's residence and the border of 
the nonresident district.  A parent may be reimbursed by the 
nonresident district for the costs of transportation from the 
pupil's residence to the border of the nonresident district if 
the pupil is from a family whose income is at or below the 
poverty level, as determined by the federal government.  
    Subd. 10.  [CREDITS TOWARD GRADUATION.] A nonresident 
district shall accept credits toward graduation that were 
awarded by another district.  The nonresident district shall 
award a diploma to a nonresident pupil if the pupil meets its 
graduation requirements. 
    Subd. 11.  [INFORMATION.] A district that does not exclude 
nonresident pupils according to subdivision 3 shall make 
information about the district, schools, programs, policies, and 
procedures available to all interested people.  
    Subd. 12.  [GENERAL EDUCATION AID.] Adjustments to general 
education aid for the resident and nonresident districts shall 
be made according to section 124A.036, subdivision 5.  
    Sec. 9.  Minnesota Statutes 1986, section 120.075, 
subdivision 1a, is amended to read:  
    Subd. 1a.  Any pupil who, pursuant to section 123.39, 
subdivision 5, has continuously been enrolled since January 1, 
1977 in a school district of which the pupil was not a resident 
may continue in enrollment in that district, and that district 
shall be considered the pupil's district of residence.  
    Sec. 10.  Minnesota Statutes 1986, section 120.075, 
subdivision 3, is amended to read:  
    Subd. 3.  Any pupil enrolled on either January 1, 1978, or 
April 5, 1978, in a nonpublic school, as defined in section 
123.932, subdivision 3, located in a district of which the pupil 
was not a resident who would otherwise have qualified for 
enrollment in that district as a resident pursuant to 
subdivision 1 may attend the public schools of that district as 
a resident. 
    Sec. 11.  Minnesota Statutes 1986, section 120.075, is 
amended by adding a subdivision to read:  
    Subd. 5.  General education aid, capital expenditure aid, 
and transportation aid attributable to pupils covered by 
programs under this section must be paid according to sections 
33, 30, and 29, respectively. 
    Sec. 12.  Minnesota Statutes 1986, section 120.0751, 
subdivision 1, is amended to read:  
    Subdivision 1.  The state board of education may permit a 
pupil who enrolls to enroll in a school district of which the 
pupil is not a resident to be deemed a resident pupil of that 
district pursuant to under this section.  
    Sec. 13.  Minnesota Statutes 1986, section 120.0751, is 
amended by adding a subdivision to read: 
    Subd. 6.  [AID.] General education aid, capital expenditure 
aid, and transportation aid for pupils covered by programs under 
this section must be paid according to sections 33, 30, and 29, 
respectively.  
    Sec. 14.  Minnesota Statutes 1986, section 120.0752, 
subdivision 1, is amended to read:  
    Subdivision 1.  A pupil may enroll in a school district of 
which the pupil is not a resident and be deemed a resident pupil 
of that district pursuant to under this section.  
     Sec. 15.  Minnesota Statutes 1987 Supplement, section 
120.0752, subdivision 3, is amended to read:  
    Subd. 3.  [11TH AND 12TH GRADE STUDENTS.] Notwithstanding 
subdivision 2, an 11th or 12th grade pupil who has been enrolled 
in a district for at least three consecutive years and whose 
parent or guardian moves to another district, may continue to 
enroll in the nonresident district upon the approval of the 
school board of the nonresident district.  The approval of the 
school board of the pupil's resident district is not required.  
The pupil shall be considered a resident of the district in 
which that student is enrolled. 
    Sec. 16.  Minnesota Statutes 1986, section 120.0752, is 
amended by adding a subdivision to read: 
    Subd. 4.  General education aid, capital expenditure aid, 
and transportation aid for pupils covered by programs under this 
section must be paid according to sections 33, 30, and 29, 
respectively.  
    Sec. 17.  Minnesota Statutes 1986, section 120.08, 
subdivision 2, is amended to read:  
    Subd. 2.  A school board in of a district maintaining a 
secondary school may by a majority vote provide for the 
instruction of any resident pupil in a school district in an 
adjoining state nearer to the pupil's place of residence than 
the school of the resident district, the distances being 
measured by the usual traveled routes.  Any charge for 
tuition or transportation, by the district so attended or for 
transportation in the adjoining state, shall be paid by 
the pupil's resident district provided that such.  The pupil 
shall continue to be considered a pupil of the resident district 
of residence for the payment purposes of apportionment and other 
state aids aid. 
    Sec. 18.  [120.105] [EDUCATION STATEMENT.] 
    Subdivision 1.  [STATEMENT CONTENTS.] Each year every 
school, as defined in section 120.101, subdivision 4, offering a 
kindergarten program must ensure that the school principal, 
kindergarten teacher, or other professional, discusses and 
distributes the following statement to every parent, guardian, 
or other person enrolling a child in kindergarten: 
    "The state of Minnesota requires that every child entering 
kindergarten this school year must graduate from high school or 
remain in high school or in an alternative program until age 
18.  Only those who have been accepted in the military or an 
institution of higher learning can leave school before they are 
18 years old." 
    The department of education must make appropriate 
provisions to accommodate those children who newly enroll in a 
public school after kindergarten.  All other schools must make 
similar provisions. 
    Sec. 19.  Minnesota Statutes 1987 Supplement, section 
120.101, subdivision 5, is amended to read:  
    Subd. 5.  [AGES AND TERMS.] For the 1988-1989 school year 
and the school years thereafter, every child between seven and 
16 years of age shall receive instruction for at least 170 days 
each year.  For the 2000-2001 school year and later school 
years, every child between seven and 18 years of age shall 
receive instruction for at least 170 days each year.  Every 
child under the age of seven who is enrolled in a half-day 
kindergarten, or a full-day kindergarten program on alternate 
days, or other kindergarten programs shall receive instruction 
at least equivalent to 170 half days.  A parent may withdraw a 
child under the age of seven from enrollment at any time. 
    Sec. 20.  Minnesota Statutes 1987 Supplement, section 
120.101, subdivision 9, is amended to read:  
    Subd. 9.  [LEGITIMATE EXEMPTIONS.] A parent, guardian, or 
other person having control of a child may apply to a school 
district to have the child excused from attendance for the whole 
or any part of the time school is in session during any school 
year.  Application may be made to any member of the board, a 
truant officer, a principal, or the superintendent.  The school 
board of the district in which the child resides may approve the 
application upon the following being demonstrated to the 
satisfaction of that board: 
    (1) That the child's bodily or mental condition is such as 
to prevent attendance at school or application to study for the 
period required; or 
    (2) That for the school years 1988-1989 through 1999-2000 
the child has already completed the studies ordinarily required 
in the tenth grade and that for the school years beginning with 
the 2000-2001 school year the child has already completed the 
studies ordinarily required to graduate from high school; or 
    (3) That it is the wish of the parent, guardian, or other 
person having control of the child, that the child attend for a 
period or periods not exceeding in the aggregate three hours in 
any week, a school for religious instruction conducted and 
maintained by some church, or association of churches, or any 
Sunday school association incorporated under the laws of this 
state, or any auxiliary thereof.  This school for religious 
instruction shall be conducted and maintained in a place other 
than a public school building, and in no event, in whole or in 
part, shall be conducted and maintained at public expense.  
However, a child may be absent from school on such days as the 
child attends upon instruction according to the ordinances of 
some church. 
    Sec. 21.  Minnesota Statutes 1986, section 123.35, 
subdivision 8, is amended to read:  
    Subd. 8.  The board may establish and maintain public 
evening schools and adult and continuing education programs and 
such evening schools and adult and continuing education programs 
when so maintained shall be available to all persons over 16 
years of age through the 1999-2000 school year and over 18 years 
of age beginning with the 2000-2001 school year who, from any 
cause, are unable to attend the full-time elementary or 
secondary schools of such district. 
    Sec. 22.  Minnesota Statutes 1987 Supplement, section 
123.3515, subdivision 1, is amended to read:  
    Subdivision 1.  [ESTABLISHMENT.] (a) An enrollment options 
program for school districts, in which a school district may 
voluntarily participate, is established under this section, and 
includes those districts not participating in the enrollment 
options program under section 8.  A participating district must 
include all grade levels offered by the district.  By formal 
resolution, a participating district must agree to: 
    (1) allow its resident pupils to enroll in other 
participating districts; 
    (2) accept nonresident pupils from other participating 
districts; and 
    (3) follow the procedures in this section.  
    (b) A nonparticipating district shall notify the 
commissioner each year by September 15 whether it will 
participate 30 of its participation in the program during the 
following school year.  For the 1987-1988 school year, a 
district must notify the commissioner by July 1, 1987.  
    Sec. 23.  Minnesota Statutes 1987 Supplement, section 
123.3515, subdivision 2, is amended to read:  
    Subd. 2.  [PUPIL APPLICATION.] A pupil who resides in a 
participating district may enroll according to this section in a 
participating nonresident district.  The pupil's parent or 
guardian must apply to the nonresident district on a form 
provided by the department of education.  The application must 
be submitted to the nonresident district by December January 1 
for enrollment during the following school year.  For the 
1987-1988 school year, an application must be submitted by 
August 1, 1987. 
    Sec. 24.  Minnesota Statutes 1987 Supplement, section 
123.3515, subdivision 3, is amended to read:  
    Subd. 3.  [NONRESIDENT DISTRICT PROCEDURES.] Within ten 
days of receiving an application, a nonresident district shall 
notify the resident district that it has received the 
application.  The nonresident district shall notify the parent 
or guardian and the resident district by February 1 whether the 
pupil's application has been approved or disapproved.  For the 
1987-1988 school year, notification must occur by August 10, 
1987.  
    Sec. 25.  Minnesota Statutes 1987 Supplement, section 
123.3515, subdivision 5, is amended to read:  
    Subd. 5.  [RACIAL BALANCE.] A school district that has a 
desegregation plan may limit the number of pupils who transfer 
into or out of the district.  An application to transfer into or 
out of a desegregation district shall be submitted to that 
district by November December 1 of each year for enrollment 
during the following school year.  For the 1987-1988 school 
year, an application must be submitted by August 1, 1987.  If 
approval of all of the applications would result in the district 
being out of compliance with its desegregation plan, the 
district shall establish the number of majority and minority 
group pupils who may transfer into or out of the district.  The 
district may approve or disapprove the applications in a manner 
that will enable compliance with the desegregation plan.  The 
district shall notify the parent or guardian by November 
December 20 whether the pupil's application has been approved or 
disapproved.  For the 1987-1988 school year, notification must 
occur by August 10, 1987. 
    Sec. 26.  Minnesota Statutes 1987 Supplement, section 
123.3515, subdivision 6, is amended to read:  
    Subd. 6.  [TRANSPORTATION.] The nonresident district shall 
provide transportation within that district for nonresident 
pupils enrolled under this section.  The state shall pay 
transportation aid to the district according to section 124.225. 
The resident district is not required to provide or pay for 
transportation between a pupil's residence and the border of the 
nonresident district.  
    A parent or guardian may apply to the nonresident district 
for reimbursement for transportation costs between the pupil's 
residence and the border of the nonresident district.  The state 
board shall establish guidelines for reimbursing the 
transportation costs based on financial need.  Chapter 14 does 
not apply to the guidelines.  
    Sec. 27.  Minnesota Statutes 1987 Supplement, section 
123.3515, subdivision 9, is amended to read:  
    Subd. 9.  [AID.] Payment of foundation aid or general 
education aid for pupils enrolled in a nonresident district must 
be made according to section 124A.036, subdivision 5 General 
education aid, capital expenditure aid, and transportation aid 
attributable to pupils covered by programs under this section 
must be paid according to sections 33, 30, and 29, respectively. 
    Sec. 28.  Minnesota Statutes 1986, section 124.18, 
subdivision 2, is amended to read:  
    Subd. 2.  [TUITION.] Except as otherwise provided in law, 
every district which provides instruction in other districts and 
which receives foundation program aid shall pay to the district 
furnishing this elementary and secondary school instruction the 
actual cost thereof chargeable to maintenance exclusive of 
transportation costs.  
    There shall also be paid for capital outlay and debt 
service to the district providing such instruction $10 per pupil 
unit in average daily membership for each nonresident pupil 
unit, except that every district educating nonresident pupils 
may charge and include in its tuition, for capital outlay and 
debt service, an amount per pupil unit in average daily 
membership based on the amount that the average expenditure for 
capital outlay and debt service determined by dividing such 
annual expenditure by the total number of pupil units in average 
daily membership in the district exceeds $10 per pupil unit.  If 
the district has no capital outlay or debt service the district 
receiving such funds may use them for any purpose for which it 
is authorized to spend money.  Provided further that if a 
district provides instruction for nonresident handicapped and 
trainable children, tuition shall be as specified in section 
120.17, subdivision 4.  
    Sec. 29.  Minnesota Statutes 1986, section 124.225, is 
amended by adding a subdivision to read: 
    Subd. 8l.  [ALTERNATIVE ATTENDANCE PROGRAMS.] A district 
that serves nonresident pupils in programs under sections 8, 
120.075, 120.0751, 120.0752, 123.3515, 126.22, and 129B.52 to 
129B.55 shall provide authorized transportation to the pupil 
within the attendance area for the school that the pupil 
attends.  The state shall pay transportation aid attributable to 
the pupil to the serving district according to this section.  
The district of the pupil's residence need not provide or pay 
for transportation between the pupil's residence and the 
district's border.  
    Sec. 30.  Minnesota Statutes 1986, section 124.245, is 
amended by adding a subdivision to read: 
    Subd. 6.  [ALTERNATIVE ATTENDANCE PROGRAMS.] The capital 
expenditure aid for districts must be adjusted for each pupil, 
excluding a handicapped pupil as defined in section 120.03, 
attending a nonresident district under sections 8, 120.075, 
120.0751, 120.0752, 123.3515, 126.22, and 129B.52 to 129B.55.  
The adjustments must be made according to this subdivision. 
    (a) Capital expenditure aid paid to a district of the 
pupil's residence must be reduced by an amount equal to the 
revenue amount per actual pupil unit of the resident district 
times the number of pupil units of pupils enrolled in 
nonresident districts. 
    (b) Capital expenditure aid paid to a district serving 
nonresidents in programs listed in subdivision 1 must be 
increased by an amount equal to the revenue amount per actual 
pupil unit of the nonresident district times the number of pupil 
units of nonresident pupils enrolled in the district.  
    (c) If the amount of the reduction to be made from the 
capital expenditure aid of a district is greater than the amount 
of capital expenditure aid otherwise due the district, the 
excess reduction must be made from other state aids due the 
district. 
    Sec. 31.  Minnesota Statutes 1987 Supplement, section 
124.26, subdivision 1b, is amended to read:  
    Subd. 1b.  [PROGRAM REQUIREMENTS.] An adult basic and 
continuing education program is a day or evening program offered 
by a district that is for people over 16 years of age through 
the 1999-2000 school year and over 18 years of age beginning 
with the 2000-2001 school year who do not attend an elementary 
or secondary school.  The program offers academic instruction 
necessary to earn a high school diploma or equivalency 
certificate.  Tuition and fees may not be charged for 
instruction subsidized under this section, except for a security 
deposit to assure return of materials, supplies, and equipment. 
    Sec. 32.  Minnesota Statutes 1986, section 124A.036, 
subdivision 2, is amended to read:  
    Subd. 2.  [DISTRICT WITHOUT SCHOOLS.] Except as otherwise 
provided in law, any district not maintaining classified 
elementary or secondary schools shall pay the tuition required 
in order to enable resident pupils to attend school in another 
district when necessary, and shall receive foundation aid 
pursuant to this section on the same basis as other districts.  
The aid shall be computed as if the pupils were enrolled in the 
district of residence.  
    Sec. 33.  Minnesota Statutes 1987 Supplement, section 
124A.036, subdivision 5, is amended to read:  
    Subd. 5.  [CERTAIN NONRESIDENTS ALTERNATIVE ATTENDANCE 
PROGRAMS.] The foundation general education aid for districts 
must be adjusted for each pupil, excluding a handicapped pupil 
as defined in section 120.03, attending a nonresident district 
under sections 8, 120.075, 120.0751, 120.0752, 123.3515, 126.22, 
and 129B.52 to 129B.55.  The adjustments must be made according 
to this subdivision. 
    (a) Foundation General education aid paid to a resident 
district must be reduced by an amount equal to the formula 
allowance plus the total tier revenue per actual pupil unit of 
the resident district times the number of pupil units of pupils 
enrolled in a nonresident general education revenue exclusive of 
compensatory revenue attributable to the pupil in the resident 
district. 
    (b) Foundation General education aid paid to a nonresident 
district serving a pupil in programs listed in this subdivision 
shall be increased by an amount equal to the formula allowance 
plus the total tier revenue per actual pupil unit of the 
nonresident district times the number of pupil units of 
nonresident pupils enrolled in that general education revenue 
exclusive of compensatory revenue attributable to the pupil in 
the nonresident district.  
    (c) If the amount of the reduction to be made from the 
foundation general education aid of the resident district is 
greater than the amount of foundation general education aid 
otherwise due the district, the excess reduction must be made 
from other state aids due the district. 
    (d) The district of residence shall pay tuition to a 
district providing special instruction and services to a 
handicapped pupil, as defined in section 120.03, who is enrolled 
in a program listed in this subdivision.  The tuition shall be 
equal to (1) the actual cost of providing special instruction 
and services to the pupil, including a proportionate amount for 
debt service and for capital expenditure facilities and 
equipment, and debt service but not including any amount for 
transportation, minus (2) the amount of special education aid, 
attributable to that pupil, that is received by the district 
providing special instruction and services. 
    Sec. 34.  [124A.31] [EQUITABLE COMPENSATION PENALTY.] 
    Subdivision 1.  [IMPLEMENTATION.] A school district subject 
to sections 471.991 to 471.999 shall implement the plan to 
establish equitable compensation relationships set forth in its 
report to the commissioner of employee relations.  The plan 
shall be implemented by December 31, 1991, unless a later date 
is approved by the commissioner.  If a report was filed before 
October 1, 1987, and had an implementation date after December 
31, 1991, the date in the report shall be approved by the 
commissioner.  
    Subd. 2.  [AID REDUCTION FOR ADMINISTRATION COSTS.] By 
October 1, 1992, the commissioner of employee relations shall 
certify to the commissioner of education the school districts 
that have not complied with subdivision 1.  For each of these 
school districts, the commissioner of education shall reduce 
general education aid for fiscal year 1993 by an amount equal to 
five percent of the district's administration costs for the 
1990-1991 school year.  If the reduction exceeds the district's 
general education aid, the reduction shall be made from other 
aids paid to the district.  
    Subd. 3.  [ADJUSTMENT OF YEARS.] The commissioners of 
employee relations and education shall adjust the years 
designated in subdivision 2 for school districts with 
implementation dates after December 31, 1991.  
    Subd. 4.  [EXTENSIONS.] The commissioner of employee 
relations must extend an implementation date upon a finding that 
failure to implement was attributable to severe hardship or to 
circumstances beyond the control of the district. 
    Sec. 35.  Minnesota Statutes 1986, section 125.12, 
subdivision 3, is amended to read:  
    Subd. 3.  [PROBATIONARY PERIOD.] The first three 
consecutive years of a teacher's first teaching experience in 
Minnesota in a single school district shall be deemed to be a 
probationary period of employment, and after completion thereof, 
the probationary period in each school district in which the 
teacher is thereafter employed shall be one year.  The school 
board shall adopt a plan for written evaluation of teachers 
during the probationary period.  Effective July 1, 1988, 
evaluation shall occur not less than at least three times each 
year for a teacher performing services on 120 or more school 
days, at least two times each year for a teacher performing 
services on 60 to 119 school days, and at least one time each 
year for a teacher performing services on fewer than 60 school 
days.  Days devoted to parent-teacher conferences, teachers' 
workshops, and other staff development opportunities and days on 
which a teacher is absent from school shall not be included in 
determining the number of school days on which a teacher 
performs services.  During the probationary period any annual 
contract with any teacher may or may not be renewed as the 
school board shall see fit; provided, however, that the school 
board shall give any such teacher whose contract it declines to 
renew for the following school year written notice to that 
effect before June 1.  If the teacher requests reasons for any 
nonrenewal of a teaching contract, the school board shall give 
the teacher its reason in writing, including a statement that 
appropriate supervision was furnished describing the nature and 
the extent of such supervision furnished the teacher during the 
employment by the board, within ten days after receiving such 
request.  The school board may, after a hearing held upon due 
notice, discharge a teacher during the probationary period for 
cause, effective immediately, under section 123.35, subdivision 
5. 
    Sec. 36.  Minnesota Statutes 1986, section 125.17, 
subdivision 2, is amended to read:  
    Subd. 2.  [PROBATIONARY PERIOD; DISCHARGE OR DEMOTION.] All 
teachers in the public schools in cities of the first class 
during the first three years of consecutive employment shall be 
deemed to be in a probationary period of employment during which 
period any annual contract with any teacher may, or may not, be 
renewed as the school board shall see fit.  The school board 
shall adopt a plan for a written evaluation of teachers during 
the probationary period.  Effective July 1, 1988, evaluation 
shall occur not less than at least three times each year for a 
teacher performing services on 120 or more school days, at least 
two times each year for a teacher performing services on 60 to 
119 school days, and at least one time each year for a teacher 
performing services on fewer than 60 school days.  Days devoted 
to parent-teacher conferences, teachers' workshops, and other 
staff development opportunities and days on which a teacher is 
absent from school shall not be included in determining the 
number of school days on which a teacher performs services.  The 
school board may, during such probationary period, discharge or 
demote a teacher for any of the causes as specified in this 
code.  A written statement of the cause of such discharge or 
demotion shall be given to the teacher by the school board at 
least 30 days before such removal or demotion shall become 
effective, and the teacher so notified shall have no right of 
appeal therefrom. 
    Sec. 37.  Minnesota Statutes 1987 Supplement, section 
126.22, subdivision 2, is amended to read:  
    Subd. 2.  [ELIGIBLE STUDENTS PUPILS.] The 
following students pupils are eligible to participate in the 
high school graduation incentives program: 
    (a) any student pupil who is between the ages of 12 and 16 
and who: 
    (1) is at least two grade levels below the performance 
level for students pupils of the same age in a locally 
determined achievement test; or 
    (2) is at least one year behind in obtaining credits for 
graduation; or 
    (3) is pregnant or is a parent; or 
    (4) has been assessed as chemically dependent; or 
    (5) has been absent from attendance at school without 
lawful excuse for one or more class periods on more than 15 
consecutive school days in the preceding or current school year; 
    (b) any student pupil who is between the ages of 16 and 19 
who is attending school, and who is at least two grade levels 
below the performance level for students pupils of the same age 
in a locally determined achievement test, or is at least one 
year behind in obtaining credits for graduation, or is pregnant 
or is a parent, or has been assessed as chemically dependent; or 
    (c) any person between 16 and 21 years of age who has not 
attended a high school program for at least 15 consecutive 
school days, excluding those days when school is not in session, 
and who is at least two grade levels below the performance level 
for students pupils of the same age in a locally determined 
achievement test, or is at least one year behind in obtaining 
credits for graduation, or has been assessed as chemically 
dependent. 
    Sec. 38.  Minnesota Statutes 1987 Supplement, section 
126.22, subdivision 3, is amended to read:  
    Subd. 3.  [ELIGIBLE PROGRAMS.] Students who are eligible to 
participate under subdivision 2 may enroll in the following 
programs:  (a) A pupil who is eligible according to subdivision 
2, clause (a), (b), or (c), may enroll in any program approved 
by the state board of education under Minnesota Rules, part 
3500.3500 or according to section 121.11, subdivision 12, may 
enroll students who are eligible to participate under 
subdivision 2, clause (a), (b) or (c);. 
    (b) Students A pupil who is eligible to participate under 
according to subdivision 2, clause (b) or (c), may enroll in 
post-secondary courses under section 123.3514; and. 
    (c) Any public secondary education program may enroll any 
student A pupil who is eligible to participate under subdivision 
2, clause (a), (b), or (c), may enroll in any public secondary 
education program. 
    Sec. 39.  Minnesota Statutes 1987 Supplement, section 
126.22, subdivision 4, is amended to read:  
    Subd. 4.  [STUDENT PUPIL ENROLLMENT.] Any eligible student 
pupil under subdivision 2 may apply to enroll in an eligible 
program under subdivision 3, using the form specified in section 
120.0752, subdivision 2.  Notwithstanding section 120.0752, 
approval of the resident district is not required for an 
eligible student pupil under subdivision 2 to enroll in a 
nonresident district which that has an eligible program under 
subdivision 3 or an area learning center established under 
section 129B.52.  A student enrolling in a program in a 
nonresident district under this section shall be considered a 
resident of that district. 
    Sec. 40.  Minnesota Statutes 1987 Supplement, section 
126.22, is amended by adding a subdivision to read: 
    Subd. 7.  [AID ADJUSTMENTS.] General education aid, capital 
expenditure aid, and transportation aid attributable to a pupil 
covered by programs under this section must be paid according to 
sections 33, 30, and 29, respectively. 
    Sec. 41.  Minnesota Statutes 1987 Supplement, section 
126.23, is amended to read:  
    126.23 [AID FOR PRIVATE ALTERNATIVE PROGRAMS.] 
    If a pupil enrolls in a nonsectarian alternative program 
operated by a private organization that has contracted with a 
school district to provide educational services for high school 
drop outs or other eligible students under section 126.22, 
subdivision 2, the resident district must reimburse the provider 
an amount equal to at least 50 percent of the formula allowance 
plus the total tier revenue attributable to that basic revenue 
of the district for each pupil.  Pupils for whom a district 
provides reimbursement may not be counted by the district for 
any purpose other than computation of basic revenue, according 
to section 124A.22, subdivision 2. 
    Sec. 42.  [126.235] [EDUCATIONAL PROGRAM FOR PREGNANT 
MINORS AND MINOR PARENTS.] 
    Upon request, a school district must make available to a 
pregnant minor or a minor custodial parent an educational 
program to enable the minor to earn a high school diploma.  The 
department of education shall develop program designs and 
provide districts with technical assistance.  A district's 
educational program must use appropriate community services and 
must recognize each pupil's individual needs and parental 
responsibilities.  The district shall designate at least one 
person to review quarterly each pupil's progress in the program. 
    If a pupil receives social services according to section 
257.33 or employment and training services according to section 
256.736, the district shall develop the pupil's educational 
program in consultation with the providers of the services and 
shall provide a liaison when necessary.  The pupil may request 
that an adult, selected by the pupil, assist in developing the 
educational program. 
    Sec. 43.  Minnesota Statutes 1986, section 126.56, 
subdivision 2, is amended to read:  
    Subd. 2.  [ELIGIBLE STUDENT.] To be eligible for a 
scholarship, a student shall: 
    (1) be a United States citizen or permanent resident of the 
United States; 
    (2) be a resident of Minnesota; 
    (2) (3) attend an eligible program; 
    (3) (4) have completed at least one year of secondary 
school but not have graduated from high school; 
    (4) (5) have earned at least a B average during the 
semester or quarter prior to application, or have earned at 
least a B average during the semester or quarter prior to 
application in the academic subject area applicable to the 
summer program the student wishes to attend; and 
    (5) (6) demonstrate need for financial assistance. 
    Sec. 44.  Minnesota Statutes 1987 Supplement, section 
126.67, subdivision 2b, is amended to read:  
    Subd. 2b.  [DISTRICT ASSESSMENTS.] As part of the PER 
process, each year a district shall, in at least three grades, 
conduct assessments among at least a sample of pupils for each 
subject area in that year of the curriculum review cycle.  The 
district's curriculum review cycle for communication, 
mathematics, science, and social studies shall not exceed five 
six years.  Assessments may not be conducted in the same 
curriculum area for two consecutive years.  The district may use 
tests from the assessment item bank, the local assessment 
program developed by the department, or other tests.  As they 
become available, districts shall use state developed measures 
to assure state progress toward the state core curriculum.  
Funds are provided for districts that choose to use the local 
assessment program or the assessment item bank. 
    Sec. 45.  Minnesota Statutes 1987 Supplement, section 
129.121, subdivision 1, is amended to read:  
    Subdivision 1.  The governing board of any high school may 
delegate the control, supervision and regulation of 
interscholastic athletics and other extracurricular activities 
referred to in section 123.38 to the Minnesota state high school 
league, a nonprofit incorporated voluntary association.  
Membership in said Minnesota state high school league shall be 
composed of such Minnesota high schools whose governing boards 
have certified in writing to the state commissioner of education 
that they have elected to delegate the control, supervision and 
regulation of their interscholastic athletic events and other 
extracurricular activities to said league.  The Minnesota state 
high school league is hereby empowered to exercise the control, 
supervision and regulation of interscholastic athletics, 
musical, dramatic and other contests by and between pupils of 
the Minnesota high schools, delegated to it pursuant to this 
section.  The Minnesota high school league may establish a 
policy or guidelines for the guidance of member high schools in 
the formation or alteration of athletic or other extracurricular 
conferences.  Except as otherwise provided by subdivision 1a, 
the formation or alteration of conferences is voluntary. 
    The commissioner of education, or the commissioner's 
representative, shall be an ex officio nonvoting member of the 
governing body of the Minnesota state high school league, with 
the same rights and privileges as other members of its governing 
body.  The governing board must include the following members:  
four members of the public, at least one of whom must be an 
American Indian, Asian, Black, or Hispanic, and all of whom must 
be parents, appointed by the governor under section 15.0597; two 
members of the Minnesota association of secondary school 
principals selected by the association; and 14 members selected 
according to league bylaws.  The board shall establish and adopt 
policies, make decisions on behalf of the league, and establish 
advisory committees necessary to carry out board functions.  The 
terms, compensation, removal of members, and the filling of 
membership vacancies are governed by section 15.0575.  Members 
of advisory committees shall be reimbursed only for expenses in 
the same manner as board members.  The rules of said the league 
shall be exempt from the provisions of sections 14.02, 14.04 to 
14.36, 14.38, 14.44 to 14.45, and 14.57 to 14.62. 
    Employees of the league shall be reimbursed only for 
expenses as authorized by the commissioner's plan for state 
employees adopted under section 43A.18, subdivision 2. 
     The league is specifically prohibited from having credit 
cards. 
    The executive director of the league shall have a 
department head expense account subject to the same limits and 
guidelines as those provided for the commissioner of education.  
The executive director shall expend money for entertainment or 
reimbursement of expenses of guests of the league only from this 
account. 
    The board shall establish a policy on the use of 
automobiles by league staff and shall show annually how league 
policy on the use of automobiles is the most cost-effective 
alternative available. 
    Sec. 46.  Minnesota Statutes 1986, section 129.121, 
subdivision 2, is amended to read:  
    Subd. 2.  Any school board is hereby authorized to expend 
moneys for and pay dues to the Minnesota state high school 
league and all moneys paid to such league, as well as moneys 
derived from any contest or other event sponsored by said 
league, shall be subject to an annual examination and audit by a 
certified public accountant or the state auditor. 
    Each year by September 1, the state auditor shall provide a 
financial and compliance audit to the legislature detailing the 
general financial condition and general status of the league as 
of July 31 of the year preceding the filing of the audit.  
Copies of the audit report must be filed with the commissioner 
of education, the chairs of the house and senate education 
committees and the director of the legislative reference 
library.  The audit report must include the aggregate totals for 
all revenues and expenditures for the three preceding years and 
the current year and the percent and dollar difference in each 
of these four years.  The following items must be audited in 
each instance:  revenues from student activities, membership 
dues, publications, registration of officials and judges, 
interest, automobile sales, and other revenues including medals, 
refunds and reimbursements; and expenditures related to staff, 
the board of directors, student activities, capital outlay, 
office and other expenditures including membership services.  
The league must pay the state auditor for the costs of the audit.
    Sec. 47.  Minnesota Statutes 1986, section 129.121, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [EMPLOYMENT.] The league must adopt an 
affirmative action policy to ensure that employment positions 
within the league are equally accessible to all qualified 
persons and to eliminate the underutilization of protected 
groups as defined in section 43A.02, subdivision 33. 
    The league shall actively and publicly recruit qualified 
people to become employees of the league.  It shall give special 
emphasis to recruiting members of protected groups.  The league 
shall advertise available positions in newspapers of general 
circulation.  The advertisement must contain a deadline for 
submitting applications that is at least 14 days after the date 
of the last advertisement.  The league shall keep each 
application for at least six months and shall notify an 
applicant when a position, for which the applicant is qualified, 
becomes available. 
    Sec. 48.  Minnesota Statutes 1986, section 129.121, is 
amended by adding a subdivision to read: 
    Subd. 2b.  [EQUITABLE COMPENSATION RELATIONSHIPS.] The 
league shall be treated as a political subdivision for purposes 
of sections 471.992 to 471.999, except that the league must 
report to the commissioner of employee relations by February 1, 
1989, on its implementation plan.  No cause of action against 
the league arises before August 1, 1989, for failure to comply 
with the requirements of sections 471.992 to 471.999. 
    Sec. 49.  Minnesota Statutes 1986, section 129.121, is 
amended by adding a subdivision to read: 
    Subd. 2c.  [DATA PRACTICES.] The collection, creation, 
receipt, maintenance, dissemination, or use of information by 
the league is subject to the provisions of chapter 13. 
    Sec. 50.  Minnesota Statutes 1987 Supplement, section 
129B.11, subdivision 2, is amended to read:  
    Subd. 2.  [ELIGIBILITY.] To be eligible for a grant, a 
group of districts must meet one of the following criteria: 
    (1) create a consolidated district according to section 
122.23, with the consolidated school district having at least 
600 pupils in average daily membership; 
    (2) establish an education district according to section 
122.91; 
    (3) form a group of districts that has an agreement under 
section 122.535 or 122.541 for discontinuing grades when the 
districts entering into the agreement have a total of at least 
240 pupils in average daily membership in grades ten, 11, and 12;
or 
    (4) enter into a joint powers agreement for a technology 
cooperative where.  The school districts in the cooperative are 
must be contiguous but are significant distances apart so that 
other forms of cooperation are not practical and either of the 
following: 
    (i) there is a significant distance between buildings in 
the district so that other forms of cooperation are not 
practical, or 
    (ii) the districts have a combined area of at least 500 
square miles. 
    Sec. 51.  Minnesota Statutes 1987 Supplement, section 
129B.11, is amended by adding a subdivision to read: 
    Subd. 2a.  [INTENTION TO CONSOLIDATE.] A group of districts 
is eligible for a grant if each school board has adopted a 
resolution of intention to consolidate with the other districts 
in the group.  If a grant is awarded to a group of districts 
under this subdivision, and if the group does not actually 
consolidate within 24 months of receiving the grant, the 
department of education shall withhold payment of all state aids 
until the amount of the grant has been recovered. 
    The state board of education may establish additional 
conditions to a grant awarded under this subdivision. 
    Sec. 52.  [129B.56] [DESIGNATION AS CENTER.] 
    The commissioner of education, in cooperation with the 
state board of education, shall establish a process for state 
designation and approval of area learning centers that meet the 
provisions of Minnesota Statutes, sections 129B.52 to 129B.55. 
    The four area learning centers designated in 1988 as 
exemplary shall be subject to the state approval process 
beginning July 1, 1990. 
    Area learning center designation shall begin July 1, 1988. 
     Sec. 53.  Minnesota Statutes 1986, section 134.351, 
subdivision 7, is amended to read:  
    Subd. 7.  [REPORTS.] Each multicounty, multitype system 
receiving a grant pursuant to section 134.353 or section 134.354 
shall provide an annual progress report to the department of 
education.  The department shall report before November 15 of 
each even-numbered year to the legislature on all projects 
funded under section 134.353 and section 134.354. 
    Sec. 54.  Minnesota Statutes 1986, section 136D.81, is 
amended to read:  
    136D.81 [DAKOTA AND GOODHUE COUNTY DISTRICTS, JOINT 
VOCATIONAL SCHOOL.] 
    Subdivision 1.  [AGREEMENTS.] Two or more of the special 
school district numbered 6 and the independent school districts 
numbered 191, 192, 194, 195, 196, 197, 199 and, 200, 252, and 
256, located wholly or partly in the county counties of 
Dakota or Goodhue, whether or not contiguous, may enter into 
agreements to accomplish jointly and cooperatively the 
acquisition, betterment, construction, maintenance, and 
operation of area vocational technical schools. Each school 
district which becomes a party to such an agreement is 
hereinafter referred to as a "participating school district."  
The agreement may provide for the exercise of such powers by the 
school board of one of the school districts on behalf of and for 
the benefit of other school districts, or by a joint school 
board created as set forth in sections 136D.81 to 136D.92.  If 
the powers are to be carried out by one of the school districts, 
it shall in doing so have the same powers and duties and be 
subject to the same limitations as are herein provided for joint 
school boards.  
    Subd. 2.  [HECB REVIEW.] No area vocational technical 
school shall be constructed pursuant to sections 136D.81 to 
136D.92 until the location of such school and its program is 
first submitted for review and recommendation by the Minnesota 
higher education coordinating board.  
    Sec. 55.  Minnesota Statutes 1986, section 260.015, 
subdivision 19, is amended to read:  
    Subd. 19.  [HABITUAL TRUANT.] "Habitual truant" means a 
child under the age of 16 years through the 1999-2000 school 
year and under the age of 18 beginning with the 2000-2001 school 
year who is absent from attendance at school without lawful 
excuse for seven school days if the child is in elementary 
school or for one or more class periods on seven school days if 
the child is in middle school, junior high school, or high 
school.  
    Sec. 56.  Minnesota Statutes 1987 Supplement, section 
422A.101, subdivision 2, is amended to read:  
    Subd. 2.  [CONTRIBUTIONS BY OR FOR CITY-OWNED PUBLIC 
UTILITIES, IMPROVEMENTS, OR MUNICIPAL ACTIVITIES.] Contributions 
by or for any city-owned public utility, improvement project and 
other municipal activities supported in whole or in part by 
revenues other than real estate taxes, any public corporation, 
any employing unit of metropolitan government, special school 
district No. 1 or Hennepin county, on account of any employee 
covered by the fund shall be calculated as follows: 
    (a) a regular employer contribution of an amount equal to 
the percentage rounded to the nearest two decimal places of the 
salaries and wages of all employees of the employing unit 
covered by the retirement fund which equals the difference 
between the level normal cost plus administrative cost reported 
in the annual actuarial valuation prepared by the 
commission-retained actuary and the employee contributions 
provided for in section 422A.10; 
    (b) an additional employer contribution of an amount equal 
to the percent specified in section 353.27, subdivision 3a, 
clause (a), multiplied by the salaries and wages of all 
employees of the employing unit covered by the retirement fund; 
    (c) a proportional share of an additional employer 
amortization contribution of an amount equal to $3,900,000 
annually until June 30, 2017, based upon the share of the fund's 
unfunded actuarial accrued liability attributed to the employer 
as disclosed in the annual actuarial valuation prepared by the 
commission-retained actuary. 
    The city council or any board or commission may, by proper 
action, provide for the inclusion of the cost of the retirement 
contributions for employees of any city-owned public utility or 
for persons employed in any improvement project or other 
municipal activity supported in whole or in part by revenues 
other than taxes who are covered by the retirement fund in the 
cost of operating the utility, improvement project or municipal 
activity.  The cost of retirement contributions for these 
employees shall be determined by the retirement board and the 
respective governing bodies having jurisdiction over the 
financing of these operating costs.  
    The cost of the employer contributions on behalf of 
employees of special school district No. 1 who are covered by 
the retirement fund shall be the obligation of the school 
district.  Contributions by the school district to the 
retirement fund or any other public pension or retirement fund 
of which its employees are members must be remitted to the fund 
each month.  An amount due and not transmitted begins to accrue 
interest at the rate of six percent compounded annually 15 days 
after the date due.  If the amount due plus interest is not paid 
30 days after interest begins to accrue, a penalty equal to ten 
percent of the amount due is added, and interest then accrues on 
the penalty as well as the amount originally due.  The 
retirement board shall prepare an itemized statement of the 
financial requirements of the fund payable by the school 
district, which shall be submitted prior to September 15.  
Contributions by the school district shall be made at times 
designated by the retirement board.  The school district may 
levy for its contribution to the retirement fund only to the 
extent permitted pursuant to section 275.125, subdivision 6a.  
    The cost of the employer contributions on behalf of 
elective officers or other employees of Hennepin county who are 
covered by the retirement fund pursuant to section 422A.09, 
subdivision 3, clause (2), 422A.22, subdivision 2, or 488A.115, 
or Laws 1973, chapter 380, section 3, Laws 1975, chapter 402, 
section 2, or any other applicable law shall be the obligation 
of Hennepin county.  The retirement board shall prepare an 
itemized statement of the financial requirements of the fund 
payable by Hennepin county, which shall be submitted prior to 
September 15.  Contributions by Hennepin county shall be made at 
times designated by the retirement board.  Hennepin county may 
levy for its contribution to the retirement fund. 
     Sec. 57.  Laws 1959, chapter 462, section 3, subdivision 4, 
as amended by Laws 1963, chapter 645, section 3, and Laws 1967, 
chapter 661, section 3, is amended to read: 
    Subd. 4.  Not later than the 15th last day of the last 
month of each fiscal year the board shall adopt and cause to be 
published two separate budgets, an operating budget and a 
capital budget for the subsequent fiscal year.  The board shall 
adopt and publish standards governing the content of its budgets 
and of its annual report. 
    Sec. 58.  [HIGH SCHOOL LEAGUE SALARY REPORT.] 
    The commissioner of employee relations shall report by 
January 15, 1989, to the chairs of the house and senate 
education committees and to the governing board of the Minnesota 
state high school league on the appropriate salary rate or range 
for the league director and the director's staff as if the 
positions were to be established in the state classified service.
    Sec. 59.  [INITIAL APPOINTMENTS TO HIGH SCHOOL LEAGUE 
BOARD.] 
    The governor shall make the initial appointments to the 
Minnesota state high school league's governing board before 
August 15, 1988.  The governing board shall be fully constituted 
by August 30, 1988.  The governor must begin the process of 
appointing four public members under Minnesota Statutes, section 
15.0597, as soon as practicable after the effective date of this 
section to ensure that the governor's initial appointees are 
appointed to the board before August 15, 1988. 
    Sec. 60.  [BINDING ARBITRATION FOR SCHOOL DISTRICTS.] 
     Notwithstanding Minnesota Statutes, section 179A.16, 
subdivision 1, if five years or more have elapsed since the 
expiration of the last collective bargaining agreement between a 
school board and the exclusive representative of the teachers, 
and if no successor agreement has been ratified by both parties, 
and if a request for binding interest arbitration is made by 
either the school board or the exclusive representative of the 
teachers, the director of the bureau of mediation services shall 
certify the request for binding interest arbitration within 15 
days of the request.  For each two-year contract term for which 
there has been no ratified successor agreement, including the 
contract term covering the date on which the request is made, 
the director shall certify, according to Minnesota Statutes, 
section 179A.16, subdivision 3, the matters as to which the 
parties have not reached agreement.  Notwithstanding Minnesota 
Statutes, section 179A.16, subdivision 7, the arbitration panel 
shall be restricted to selecting between the final offer of one 
party or the other party in its entirety.  Unless otherwise 
provided in this section, Minnesota Statutes, section 179A.16, 
applies to the interest arbitration. 
     Sec. 61.  [LEARNING YEAR PROGRAM SITES.] 
    Subdivision 1.  [PROGRAM ESTABLISHED FOR TWO YEARS.] A 
program is established to designate learning year program sites 
for providing instruction throughout the entire year.  The 
learning year programs may begin June 9, 1988, and end June 9, 
1990.  The programs must permit students in grades 9 through 12 
to receive instruction throughout the entire year. 
    Students may participate in the program if they reside in: 
    (1) a district that has been designated a learning year 
program site under subdivision 2; 
    (2) a district that is a member of the same education 
district as a program site; or 
    (3) a district that participates in the same area learning 
center program as a program site. 
    Subd. 2.  [STATE BOARD DESIGNATION.] Up to five districts 
may be designated learning year program sites by the state board 
of education.  To be designated, a district must demonstrate to 
the commissioner of education that the district will: 
    (1) provide a program of instruction that permits students 
in grades 9 through 12 to receive instruction throughout the 
entire year; and 
    (2) maintain a record system that, for purposes of section 
124.17, permits identification of membership attributable to 
students participating in the program.  The purpose for 
identifying this membership is to ensure that a district will 
not be able to increase the total number of pupil units 
attributable to an individual student by providing a learning 
year program.  The commissioner of education shall consult with 
the director of the education aids and levies section of the 
department of education when determining whether the record 
system of a participating district is adequate for this purpose. 
    Subd. 3.  [HOURS OF INSTRUCTION.] Students participating in 
a program must be able to receive 4,200 hours of instruction so 
that they are able to complete the requirements of grades 9 
through 12.  If a student has not completed the graduation 
requirements of the district after completing 4,200 hours of 
instruction, the student may continue to enroll in courses 
needed for graduation until either the student meets the 
graduation requirements or the student is 21 years old, 
whichever occurs first.  
    For the purposes of Minnesota Statutes, section 120.101, 
subdivision 5, 1,020 hours of instruction shall constitute 170 
days of instruction.  Hours of instruction that occur between 
June 9 and June 30 shall be attributed to the fiscal year 
following the days of actual instruction. 
    Subd. 4.  [STUDENT PLANNING.] A district must inform all 
junior and senior high school students and their parents about 
the learning year program.  A continual learning plan for the 
4,200 hours of education must be developed for each student with 
the participation of the student, parent or guardian, teachers, 
and other staff.  The plan must identify the learning 
experiences needed for graduation and must specify the learning 
experiences that will occur each year.  The student or district 
may modify the plan according to district schedule changes.  The 
district may not modify the plan if the modification would 
result in delaying the student's time of graduation.  
    Subd. 5.  [TRANSPORTATION.] Summer transportation 
expenditures for this program must be included in nonregular 
transportation according to Minnesota Statutes, sections 
124.225, subdivision 8; and 275.125, subdivision 5c.  
    Subd. 6.  [CONTRACTS.] A district may contract with a 
licensed employee to provide services in a learning year program 
that are in addition to the services provided according to the 
master contract of employment for teachers, entered into under 
chapter 179A, or an equivalent contract for licensed employees 
who are not teachers.  These additional services and 
compensation, if any, for the services shall not become a part 
of the employee's continuing contract rights under Minnesota 
Statutes, section 125.12 or 125.17.  The duration of a contract 
is negotiable, but may not extend beyond June 9, 1990. 
    Subd. 7.  [REVENUE COMPUTATION AND REPORTING.] Aid and levy 
revenue computations shall 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 124.17, average daily 
membership shall be computed by dividing the total number of 
hours of participation for the fiscal year by 1,050.  Hours of 
participation that occur between June 9 and June 30 shall be 
attributed to the fiscal year following the hours of actual 
participation.  Thirty hours may be used for teacher workshops, 
staff development, or parent-teacher conferences.  As part of 
each pilot program, the department of education, the 
commissioner of education, 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 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. 
    State aid and levy revenue computation for the learning 
year programs begins July 1, 1988, for fiscal year 1989.  
    Subd. 8.  [EXEMPTION.] To operate the pilot program, the 
state board of education may exempt the district from specific 
rules relating to student and financial accounting, reporting, 
and revenue computation. 
    Sec. 62.  [HIBBING, TOWER, VIRGINIA, GRAND RAPIDS SCHOOL 
DISTRICT BONDS.] 
    Subdivision 1.  [AUTHORIZATION.] Independent school 
district No. 701, Hibbing, may issue bonds in an aggregate 
principal amount not exceeding $3,500,000, and independent 
school district No. 708, Tower, may issue bonds in an aggregate 
principal amount not exceeding $1,000,000, and independent 
school district No. 706, Virginia, may issue bonds in an 
aggregate principal amount not exceeding $2,500,000, and 
independent school district No. 318, Grand Rapids, may issue 
bonds in an aggregate principal amount not exceeding $1,000,000, 
in addition to any bonds already issued or authorized, to 
provide funds to construct, equip, furnish, remodel, 
rehabilitate, and acquire land for school facilities and 
buildings.  They may spend the proceeds of the bond sale for 
those purposes and any architects', engineers', and legal fees 
incidental to those purposes or the sale.  Except as permitted 
by this section, the bonds shall be authorized, issued, sold, 
executed, and delivered in the manner provided by Minnesota 
Statutes, chapter 475.  A resolution of the board levying taxes 
for the payment of the bonds and interest on them as authorized 
by this section and pledging the proceeds of the levies for the 
payment of the bonds and interest on them shall be deemed to be 
in compliance with the provisions of chapter 475 with respect to 
the levying of taxes for their payment.  
    Subd. 2.  [APPROPRIATION.] There is annually appropriated 
from the distribution of taconite production tax revenues to the 
taconite environmental protection fund pursuant to section 
298.28, subdivision 11, and to the northeast Minnesota economic 
protection trust pursuant to section 298.28, subdivisions 9 and 
11, in equal shares, an amount sufficient to pay when due 80 
percent of the principal and interest on the bonds issued 
pursuant to subdivision 1.  If the annual distribution to the 
northeast Minnesota economic protection trust is insufficient to 
pay its share after fulfilling any obligations of the trust 
under section 298.225 or 298.293, the deficiency shall be 
appropriated from the taconite environmental protection fund.  
    Subd. 3.  [DISTRICT OBLIGATIONS.] Bonds issued under 
authority of this section shall be the general obligations of 
the school district, for which its full faith and credit and 
unlimited taxing powers shall be pledged.  If there are any 
deficiencies in the amount received pursuant to subdivision 2, 
they shall be made good by general levies, not subject to limit, 
on all taxable properties in the district in accordance with 
Minnesota Statutes, section 475.74.  If any deficiency levies 
are necessary, the school board may effect a temporary loan or 
loans on certificates of indebtedness issued in anticipation of 
them to meet payments of principal or interest on the bonds due 
or about to become due.  
    Subd. 4.  [DISTRICT LEVY.] The school board shall by 
resolution levy on all property in the school district subject 
to the general ad valorem school tax levies, and not subject to 
taxation under Minnesota Statutes, sections 298.23 to 298.28, a 
direct annual ad valorem tax for each year of the term of the 
bonds in amounts that, if collected in full, will produce the 
amounts needed to meet when due 20 percent of the principal and 
interest payments on the bonds.  A copy of the resolution shall 
be filed, and the necessary taxes shall be extended, assessed, 
collected, and remitted in accordance with Minnesota Statutes, 
section 475.61.  
    Subd. 5.  [LEVY LIMITATIONS.] Taxes levied pursuant to this 
section shall be disregarded in the calculation of any other tax 
levies or limits on tax levies provided by other law.  
    Subd. 6.  [BONDING LIMITATIONS.] Bonds may be issued under 
authority of this section notwithstanding any limitations upon 
the indebtedness of a district, and their amounts shall not be 
included in computing the indebtedness of a district for any 
purpose, including the issuance of subsequent bonds and the 
incurring of subsequent indebtedness.  
    Subd. 7.  [TERMINATION OF APPROPRIATION.] The appropriation 
authorized in subdivision 2 shall terminate upon payment or 
maturity of the last of those bonds.  
    Subd. 8.  [LOCAL APPROVAL.] This section is effective for 
independent school district No. 701 the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3, and for independent school district No. 708 the 
day after its governing body complies with Minnesota Statutes, 
section 645.021, subdivision 3, and for independent school 
district No. 706 the day after its governing body complies with 
Minnesota Statutes, section 645.021, subdivision 3, and for 
independent school district No. 318 the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3. 
    Sec. 63.  [SCHOOL DISTRICT NO. 710 BONDS.] 
    Subdivision 1.  [AUTHORIZATION.] Independent school 
district No. 710, St. Louis county, may issue bonds in an 
aggregate principal amount not exceeding $1,000,000, in addition 
to any bonds already issued or authorized, to provide funds to 
construct, equip, furnish, remodel, rehabilitate, and acquire 
land for school facilities and buildings.  The district may 
spend the proceeds of the bond sale for those purposes and any 
architects', engineers', and legal fees incidental to those 
purposes or the sale.  Except as permitted by this section, the 
bonds shall be authorized, issued, sold, executed, and delivered 
in the manner provided by Minnesota Statutes, chapter 475.  A 
resolution of the board levying taxes for the payment of the 
bonds and interest on them as authorized by this section and 
pledging the proceeds of the levies for the payment of the bonds 
and interest on them shall be deemed to be in compliance with 
the provisions of chapter 475 with respect to the levying of 
taxes for their payment.  
    Subd. 2.  [APPROPRIATION.] There is annually appropriated 
from the distribution of taconite production tax revenues to the 
taconite environmental protection fund pursuant to section 
298.28, subdivision 11, and to the northeast Minnesota economic 
protection trust pursuant to section 298.28, subdivisions 9 and 
11, in equal shares, an amount sufficient to pay when due 100 
percent of the principal and interest on the bonds issued 
pursuant to subdivision 1.  If the annual distribution to the 
northeast Minnesota economic protection trust is insufficient to 
pay its share after fulfilling any obligations of the trust 
under section 298.225 or 298.293, the deficiency shall be 
appropriated from the taconite environmental protection fund.  
    Subd. 3.  [DISTRICT OBLIGATIONS.] Bonds issued under 
authority of this section shall be the general obligations of 
the school district, for which its full faith and credit and 
unlimited taxing powers shall be pledged.  If there are any 
deficiencies in the amount received pursuant to subdivision 2, 
they shall be made good by general levies, not subject to limit, 
on all taxable properties in the district in accordance with 
Minnesota Statutes, section 475.74.  If any deficiency levies 
are necessary, the school board may effect a temporary loan or 
loans on certificates of indebtedness issued in anticipation of 
them to meet payments of principal or interest on the bonds due 
or about to become due.  
    Subd. 4.  [LEVY LIMITATIONS.] Taxes levied pursuant to this 
section shall be disregarded in the calculation of any other tax 
levies or limits on tax levies provided by other law.  
    Subd. 5.  [BONDING LIMITATIONS.] Bonds may be issued under 
authority of this section notwithstanding any limitations upon 
the indebtedness of a district, and their amounts shall not be 
included in computing the indebtedness of a district for any 
purpose, including the issuance of subsequent bonds and the 
incurring of subsequent indebtedness.  
    Subd. 6.  [TERMINATION OF APPROPRIATION.] The appropriation 
authorized in subdivision 2 shall terminate upon payment or 
maturity of the last of those bonds.  
    Subd. 7.  [LOCAL APPROVAL.] This section is effective for 
independent school district No. 710 the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3. 
    Sec. 64.  [ENVIRONMENTAL LEARNING CENTER.] 
    Notwithstanding any law to the contrary, a county in which 
a facility is located that qualifies for a tax credit pursuant 
to section 298.24, subdivision 4, is authorized to issue general 
obligation bonds in a principal amount up to $1,700,000.  The 
bonds shall be issued pursuant to chapter 475 except the 
requirements of section 475.58 shall not apply and the amount of 
the bonds shall not be counted in computing any net debt 
limitation imposed by chapter 475, or any other law.  The 
proceeds of the bond issue may be expended for the purchase of 
land and construction of facilities for an environmental 
learning center.  The environmental learning center shall 
annually make payment in a sum sufficient to repay the annual 
principal and interest due on the bonds and reimburse the county 
for any costs incurred in the issuance of the bonds; provided 
that the county and the environmental learning center may 
negotiate a payment schedule based on level periodic payments 
which, in total, would be sufficient to amortize the principal 
and interest of the bonds over their entire term and compensate 
the county for the difference in the timing of the payments and 
the actual amortization requirements of the bonds' repayment 
schedule.  If the environmental learning center fails to make 
the payments required, there is appropriated from the Northeast 
Minnesota Economic Protection Trust an amount sufficient to 
repay any remaining interest and principal due on the bonds.  
The amount of any payment from the Northeast Minnesota Economic 
Protection Trust is a lien against the property that is 
purchased and improved with the proceeds of the bond. 
     Sec. 65.  [REPEALER.] 
    Minnesota Statutes 1986, section 121.9121, subdivision 7; 
Minnesota Statutes 1987 Supplement, sections 123.703, 
subdivision 3; 129B.74; and 129B.75; and Laws 1984, chapter 463, 
article 7, section 45, are repealed effective July 1, 1988.  
Section 60 is repealed July 1, 1989.  Section 8, subdivision 1, 
and Minnesota Statutes 1987 Supplement, section 123.3515, are 
repealed June 30, 1990.  
    Sec. 66.  [EFFECTIVE DATE.] 
    Sections 1, 2, 3, 4, 5, 6, 7, 43, 56, 57, and 59 are 
effective the day following final enactment. 
    Section 54 is effective the day following final enactment.  
A district specified in section 54 located wholly or partly in 
Goodhue county may become a participating district upon adoption 
of an approving resolution by its school board and the board of 
intermediate school district No. 917, upon compliance with 
Minnesota Statutes, section 136D.85, and upon execution of an 
agreement with the board of intermediate school district No. 917.
    Section 8 is effective for the 1989-1990 school year and 
thereafter.  
    After December 31, 1993, the provisions of Minnesota 
Statutes, section 92.67, subdivisions 1 and 3, apply only to 
sales made under section 6, subdivision 4, clause (a)(5). 

                               ARTICLE 8 

                          EDUCATION FACILITIES 
    Section 1.  [121.148] [SCHOOL DISTRICT CONSTRUCTION.] 
    Subdivision 1.  [POSITIVE REVIEW AND COMMENT.] If the 
commissioner submits a positive review and comment for a 
proposal according to section 121.15, the school board may 
proceed with the construction according to the requirements of 
applicable laws. 
    Subd. 2.  [NEGATIVE REVIEW AND COMMENT.] If the 
commissioner submits a negative review and comment for a 
proposal according to section 121.15, the school board, by 
resolution of the board, shall reconsider construction.  If, 
upon reconsideration, the school board decides to proceed with 
construction, it may initiate proceedings for issuing bonds to 
finance construction under sections 475.51 to 475.76.  Unless 60 
percent of the voters at the election approve of issuing the 
obligations, the board is not authorized to issue the 
obligations. 
    Sec. 2.  Minnesota Statutes 1986, section 121.15, is 
amended to read:  
    121.15 [REVIEW AND COMMENT FOR SCHOOL DISTRICT 
CONSTRUCTION.] 
    Subdivision 1.  [CONSULTATION.] A school district shall 
consult with the department commissioner of education before 
developing any plans and specifications to construct, remodel, 
or improve the building or site of an educational facility, 
other than an area vocational technical institute, for which the 
estimated cost exceeds $100,000.  This consultation shall occur 
before a referendum for bonds, solicitation for bids, or use of 
capital funds expenditure facilities revenue according to 
section 275.125, subdivision 11a, clause (c), is 
initiated section 4, subdivision 6, clause (2). 
    Subd. 2.  [PLAN SUBMITTAL.] The department of education 
commissioner, after the consultation required in subdivision 1, 
may require a school district engaging in a construction, 
remodeling, or site improvement project to submit the following 
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 department of 
education commissioner shall approve or disapprove the plans 
within 60 days after submission.  A school district shall not 
award contracts before the department approves the plans.  
    Final plans shall meet all applicable state laws, rules, 
and codes concerning public buildings, including sections 16B.59 
to 16B.73.  The department of education's approval shall be 
limited to compliance with applicable state laws, rules, and 
codes and shall reasonably conform to the recommended 
educational standards established by the department of 
education.  The department may furnish to a school district 
plans and specifications for temporary school buildings 
containing two classrooms or less.  
    Subd. 3.  [FINAL PLANS.] If no a construction contract has 
not been awarded within two years of approval, the approval 
shall no longer not be valid.  After approval, final plans and 
the approval shall be filed with the department commissioner of 
education.  If substantial changes are made to approved plans 
after final approval, documents reflecting the changes shall be 
submitted to the department of education commissioner for 
approval.  Upon completing a project, the school board shall 
certify to the department commissioner that the project was 
completed according to the approved plans.  
    Subd. 4.  [CONDEMNATION OF SCHOOL BUILDINGS.] The 
department of education commissioner may condemn school 
buildings and sites which that the state board of education 
determines are unfit or unsafe for that use.  
    Subd. 5.  [RULEMAKING.] The state board of education may 
adopt rules for public school buildings.  
    Subd. 6.  [REVIEW AND COMMENT.] No referendum for bonds or 
solicitation of bids for new construction, expansion, or 
remodeling of an educational facility which that requires a 
capital an expenditure in excess of $400,000 per school site 
shall be initiated prior to review and comment by the 
commissioner.  A school board shall not separate portions of a 
single project into components to avoid the requirements of this 
subdivision.  
    Subd. 7.  [INFORMATION REQUIRED.] A school board proposing 
to construct a facility described in subdivision 6 shall submit 
to the commissioner a proposal containing information including 
at least the following: 
    (a) the geographic area proposed to be served, whether 
within or outside the boundaries of the school district;  
    (b) the population 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 capital 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;  
    (e) so far as is known, a description of existing 
facilities within the area to be served that offer the same or 
similar service 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 from other sources, including other school districts, 
post-secondary institutions for higher education, or other 
public buildings; and the anticipated effect that the proposal 
facility will have on existing facilities and services;  
    (f) the anticipated benefit of the facility to the area 
that will result from the facility;  
    (g) if known, the relationship of the proposed construction 
to any priorities which 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; and 
    (i) desegregation requirements that cannot be met by any 
other reasonable means; and 
     (j) the relationship of the proposed facility to the 
cooperative integrated learning needs of the area.  
    Subd. 8.  [REVIEW OF PROPOSALS.] In reviewing each 
proposal, the commissioner shall submit to the school board, 
within 60 days of receiving the proposal, the review and comment 
about the educational and economic advisability of the project.  
The review and comment shall be based on information submitted 
with the proposal and other information the commissioner 
determines is necessary.  If the commissioner submits a negative 
review and comment for a portion of a proposal, the review and 
comment shall clearly specify which portion of the proposal 
received a negative review and comment and which portion of the 
proposal received a positive review and comment. 
    Subd. 9.  [PUBLICATION.] At least 20 days but not more than 
60 days before a referendum for bonds or solicitation of bids to 
construct a facility described in subdivision 6, the school 
board shall publish the commissioner's review and comment in a 
the legal newspaper of general circulation in the area the 
district.  Supplementary information shall be available to the 
public.  
    Subd. 10.  [REPORT.] Before January 15 of each year, the 
commissioner shall report to the legislature about the number 
and nature of proposals for projects submitted according to this 
section, the nature of the review and comment on the educational 
and economic advisability of the project, and any 
recommendations.  
    Sec. 3.  Minnesota Statutes 1987 Supplement, section 
121.912, subdivision 1, is amended to read:  
    Subdivision 1.  [LIMITATIONS.] Except as provided in this 
subdivision, sections 121.9121, 123.36, 4, 475.61, and 475.65, a 
school district may not permanently transfer money from (1) an 
operating fund to a nonoperating fund; (2) a nonoperating fund 
to another nonoperating fund; or (3) a nonoperating fund to an 
operating fund.  Permanent transfers may be made from any fund 
to any other fund to correct for prior fiscal years' errors 
discovered after the books have been closed for that year.  
Permanent transfers may be made from the general fund to any 
other operating funds if the resources of the other fund are not 
adequate to finance approved expenditures from that other fund.  
Permanent transfers may also be made from the general fund to 
eliminate deficits in another fund when that other fund is being 
discontinued.  When a district discontinues operation of a 
district-owned bus fleet or a substantial portion of a fleet, 
permanent transfers may be made from the fund balance account 
entitled "pupil transportation fund appropriated for bus 
purchases" to the capital expenditure fund, with the approval of 
the commissioner.  The levy authorized pursuant to 
section 275.125, subdivision 11a 4, shall be reduced by an 
amount equal to the amount transferred.  Any school district may 
transfer any amount from the unappropriated fund balance account 
in its transportation fund to any other operating fund or to the 
appropriated fund balance account for bus purchases in its 
transportation fund. 
    Sec. 4.  [124.243] [CAPITAL EXPENDITURE; FACILITIES.] 
    Subdivision 1.  A school board shall, by resolution adopted 
by a two-thirds vote of its governing body and after notice and 
hearing, adopt a capital expenditure facilities program.  The 
district shall publish notice of the hearing in its official 
newspaper at least 20 days before the hearing.  The program 
shall include plans for repair and restoration of existing 
district-owned facilities and plans for new construction.  The 
program shall include specific provisions to correct any 
existing health and safety hazards.  The program must set forth 
the facilities to be improved, a schedule of work not more than 
five years from the adoption or amendment of the program, the 
estimated cost of the improvements to be made, and the proposed 
methods of financing the program.  The program must be reviewed 
by the district biennially before July 1 of each odd-numbered 
year, after notice and hearing.  After the review, the program 
may be amended to include the ensuing five-year period.  
    Subd. 2.  [CAPITAL EXPENDITURE FACILITIES REVENUE.] Capital 
expenditure facilities revenue for a district equals the lesser 
of: 
    (1) $137 times its actual pupil units for the school year; 
or 
    (2) the difference between $400 times the actual pupil 
units for the school year and the unreserved balance in the 
capital expenditure facilities account on June 30 of the second 
prior school year.  For the purpose of determining revenue for 
the 1989-1990 and the 1990-1991 school years, the unreserved 
balance in the capital expenditure facilities account on June 30 
of the second prior school year is zero.  
    Subd. 3.  [CAPITAL EXPENDITURE FACILITIES LEVY.] To obtain 
capital expenditure facilities revenue, a district may levy an 
amount not to exceed the capital expenditure facilities revenue 
determined in subdivision 2 multiplied by the lesser of one, or 
the ratio of: 
     (1) the quotient derived by dividing the adjusted assessed 
valuation of the district for the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the school year to which the levy is attributable, to 
    (2) 75 percent of the equalizing factor for the school year 
to which the levy is attributable. 
    Subd. 4.  [ALTERNATE LEVY.] If a district's capital 
expenditure facilities revenue is less than $137 times the 
actual pupil units for the school year, the levy shall be the 
following amount: 
    (1) the levy determined in subdivision 3, times 
    (2) the ratio of the capital expenditure facilities revenue 
to an amount equal to $137 times the actual pupil units. 
    Subd. 5.  [CAPITAL EXPENDITURE FACILITIES AID.] A 
district's capital expenditure facilities aid is the difference 
between the capital expenditure facilities revenue and the 
capital expenditure facilities levy.  If the district does not 
levy the entire amount permitted, the aid is reduced in 
proportion to the actual amount levied.  Capital expenditure 
facilities aid must not be reduced as a result of the reduction 
in capital expenditure facilities levy under section 3.  
    Subd. 6.  [USES OF REVENUE.] Capital expenditure facilities 
revenue may be used only for the following purposes: 
    (1) to acquire land for school purposes; 
    (2) to acquire or construct buildings for school purposes, 
if approved by the commissioner of education according to 
applicable statutes and rules; 
    (3) to rent or lease buildings, including the costs of 
building repair or improvement that are part of a lease 
agreement; 
    (4) to equip, reequip, improve, and repair school sites, 
buildings, and permanent attached fixtures; 
     (5) for a surplus school building that is used 
substantially for a public nonschool purpose; 
    (6) to eliminate barriers or increase access to school 
buildings by handicapped individuals; 
    (7) to bring school buildings into compliance with the 
uniform fire code adopted according to chapter 299F; 
    (8) to remove asbestos from school buildings, encapsulate 
asbestos, or make asbestos-related repairs; 
    (9) to clean up and dispose of polychlorinated biphenyls 
found in school buildings; 
    (10) to clean up, remove, dispose of, and make repairs 
related to storing heating fuel or transportation fuels such as 
alcohol, gasoline, fuel oil, and special fuel, as defined in 
section 296.01; 
    (11) for energy audits for school buildings and to modify 
buildings if the audit indicates the cost of the modification 
can be recovered within ten years; 
    (12) to improve buildings that are leased according to 
section 123.36, subdivision 10; 
    (13) to pay special assessments levied against school 
property but not to pay assessments for service charges; 
    (14) to pay principal and interest on state loans for 
energy conservation according to section 116J.37 or loans made 
under the northeast Minnesota economic protection trust fund act 
according to sections 298.292 to 298.298; and 
    (15) to purchase or lease interactive telecommunications 
equipment. 
    Subd. 7.  [SEPARATE ACCOUNT.] Capital expenditure 
facilities revenue must be placed in a separate account within 
the capital expenditure fund. 
    Subd. 8.  [FUND TRANSFERS.] Money in the account for 
capital expenditure facilities revenue must not be transferred 
into any other account or fund, except that the school board 
may, by resolution, transfer money into the debt redemption fund 
to pay the amounts needed to meet, when due, principal and 
interest payments on certain obligations issued according to 
chapter 475. 
    Subd. 9.  [FUND ALLOCATION.] Capital expenditure facilities 
revenue may be allocated to the capital expenditure fund or the 
debt redemption fund.  Each year a district shall notify the 
department about the amount of the capital expenditure 
facilities revenue to be allocated to each fund.  The department 
shall calculate the aid and levy for each fund and reduce the 
debt service levy of the district by the amount of the levy 
allocated to the debt redemption fund. 
    Subd. 10.  [INTEREST INCOME.] All interest income 
attributable to the capital expenditure facilities revenue 
account must be credited to the account. 
    Sec. 5.  Minnesota Statutes 1987 Supplement, section 
124.244, is amended to read:  
    124.244 [CAPITAL EXPENDITURE EQUIPMENT REVENUE.] 
    Subdivision 1.  [REVENUE AMOUNT.] The capital 
expenditure equipment revenue for each district equals $153 $70 
times its actual pupil units counted according to section 
124.17, subdivision 1, for the school year.  
    Subd. 2.  [CAPITAL EXPENDITURE EQUIPMENT LEVY.] To obtain 
capital expenditure equipment revenue, a district may levy an 
amount not to exceed three mills times the adjusted assessed 
valuation of the district for the preceding year the district's 
capital expenditure equipment revenue as determined in 
subdivision 1 multiplied by the lesser of one, or the ratio of: 
     (1) the quotient derived by dividing the adjusted assessed 
valuation of the district for the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the school year to which the levy is attributable, to 
     (2) 75 percent of the equalizing factor for the school year 
to which the levy is attributable.  
    Subd. 3.  [CAPITAL EXPENDITURE EQUIPMENT AID.] A district's 
capital expenditure equipment aid is the difference between the 
capital expenditure equipment revenue and the capital 
expenditure equipment levy.  If a district does not levy the 
entire amount permitted, capital expenditure equipment aid must 
be reduced in proportion to the actual amount levied.  Capital 
expenditure equipment aid must not be reduced as a result of a 
reduction of its capital expenditure equipment levy under 
section 6. 
    Subd. 4.  [USES OF REVENUE.] Capital expenditure equipment 
revenue may be used only for the following purposes:  
    (1) to acquire land for school purposes; 
    (2) to acquire or construct buildings for school purposes, 
if approved by the commissioner of education according to 
applicable statutes and rules; 
    (3) to rent or lease buildings for school purposes; 
    (4) to equip, reequip, improve, and repair school sites, 
buildings and permanent attached fixtures; 
    (5) to eliminate barriers or increase access to school 
buildings by handicapped individuals; 
    (6) to bring school buildings into compliance with the 
uniform fire code adopted according to chapter 299F; 
    (7) to remove asbestos from school buildings, encapsulate 
asbestos, or make asbestos-related repairs; 
    (8) to clean up and dispose of polychlorinated biphenyls 
found in school buildings; 
    (9) to clean up, remove, dispose of, and make repairs 
related to storing heating fuel or transportation fuels such as 
alcohol, gasoline, fuel oil, and special fuel, as defined in 
section 296.01; 
    (10) for energy audits for school buildings and to make 
modifications if the audit indicates the costs can be recovered 
within ten years; 
    (11) to improve buildings that are leased according to 
section 123.36, subdivision 10; 
    (12) to pay special assessments levied against school 
property but not to pay assessments for service charges; 
    (13) to pay capital expenditure equipment related 
assessments of an educational cooperative service unit any 
entity formed under a cooperative agreement between two or more 
districts; 
    (14) to pay principal and interest on state loans for 
energy conservation according to section 116J.37 or loans made 
under the northeast Minnesota economic protection trust fund act 
according to sections 298.292 to 298.298; 
    (15) (2) to purchase or lease computers and related 
materials, copying machines, and telecommunications equipment, 
and other noninstructional equipment; 
    (16) (3) to purchase or lease equipment for secondary 
vocational education programs or senior secondary industrial 
arts instructional programs; and 
    (17) (4) to purchase textbooks; 
    (5) to purchase library books; and 
    (6) to purchase vehicles except those for which a levy is 
authorized under section 275.125, subdivision 5f. 
    Sec. 6.  [124.2445] [PURCHASE OF CERTAIN EQUIPMENT.] 
    The board of a school district may issue certificates of 
indebtedness or capital notes subject to the school district 
debt limits to purchase vehicles other than school buses, 
computers, telephone systems, cable equipment, photocopy and 
office equipment, technological equipment for instruction, and 
other capital equipment having an expected useful life at least 
as long as the terms of the certificates or notes.  The 
certificates or notes must be payable in not more than five 
years and must be issued on the terms and in the manner 
determined by the board.  A tax levy must be made for the 
payment of the principal and interest on the certificates or 
notes, in accordance with section 475.61, as in the case of 
bonds.  That tax levy for each year must not exceed the amount 
of the district's capital expenditure equipment levy under 
section 124.244 for the year the initial debt service levies are 
certified.  The district's capital expenditure levy under 
section 124.244 for each year must be reduced by the amount of 
the tax levies for debt service certified for each year for 
payment of the principal and interest on the certificates or 
notes as required by section 475.61.  
    Sec. 7.  Minnesota Statutes 1986, section 124.43, 
subdivision 1, is amended to read:  
    Subdivision 1.  [REVIEW BY COMMISSIONER.] (a) To the extent 
moneys are from time to time available hereunder, The 
commissioner may, after review and a favorable recommendation by 
the state board of education, recommend to the legislature 
capital loans to school districts.  Proceeds of the loans shall 
be used only for sites for school buildings and for acquiring, 
bettering, furnishing, or equipping school buildings under 
contracts to be entered into within 12 months from and after the 
date on which each loan is granted.  Applications with the 
accompanying data specified in subdivision 2 shall be filed 
between October 1 of any year and the following June 1.  
    (b) Any school board which that intends to submit an 
application for a capital loan shall submit a proposal to the 
commissioner for review and comment pursuant to section 
121.15 by September 1 of any year, and the commissioner shall 
prepare a review and comment on the proposed facility, 
regardless of the amount of the capital expenditure required to 
construct the facility.  The state board shall not make a 
favorable recommendation on an application for a capital loan 
for any facility unless:  
    (1) the facility receives a favorable positive review and 
comment pursuant to section 121.15; and 
    (2) the state board determines that 
    (A) the facilities are needed to replace facilities 
dangerous to the health and safety of pupils, or to provide for 
pupils for whom no adequate facilities exist; 
    (B) the facilities could not be made available through 
dissolution and attachment of the district to another district 
or through pairing, interdistrict cooperation, or consolidation 
with another district, or through the purchase or lease of 
facilities from existing institutions within the area.  The 
preference of the school district regarding reorganization shall 
not be a criterion used by the state board in determining 
whether the facilities could be made available through 
reorganization;  
    (C) the facilities are comparable in size and quality to 
facilities recently constructed in other districts of similar 
enrollment; and 
    (D) the district's need for the facilities is comparable to 
needs which that comparable districts are meeting through local 
bond issues. 
    The state board may recommend that the loan be approved in 
a reduced amount in order to meet the foregoing criteria.  If 
the state board recommends that a loan not be approved, the 
commissioner shall not recommend approval of the loan.  If the 
state board recommends that the loan be approved in a reduced 
amount, the commissioner shall not recommend approval of a loan 
larger than that recommended by the state board.  
    (c) As part of reviewing an application for a capital loan, 
the commissioner of education shall prepare estimated yearly 
repayments by the school district and the estimated amount of 
principal and interest that may be forgiven after the term of 
the loan.  These estimates shall assume no growth in assessed 
valuation over the term of the loan, shall assume a 16 mill levy 
equal to 16 mills times the adjusted assessed value, and shall 
be prepared using a methodology approved by the commissioner of 
finance.  The commissioner of education shall use a discount 
factor provided by the commissioner of finance in determining 
the present value of the estimated amount of interest and 
principal which may be forgiven after the term of the loan.  
    (d) No loan shall be recommended for approval for any 
district exceeding an amount computed as follows: 
    (1) The amount voted requested by the district under 
subdivision 2; 
    (2) Plus the aggregate principal amount of general 
obligation bonds of the district outstanding on the date of 
approval 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 24 percent of the 
adjusted assessed value, whichever is less; 
    (3) Less the maximum net debt permissible for the district 
on the date of approval on December 1 of the year the 
application is received, under the limitation in section 475.53, 
subdivision 4, or 24 percent of the most recent adjusted 
assessed value available at the time of application, whichever 
is less; and 
    (4) Less any amount by which the amount voted exceeds the 
total cost of the facilities for which the loan is granted, as 
estimated in accordance with subdivision 4, provided that the 
loan may be approved in an amount computed as provided in 
clauses (1) to (3), subject to subsequent reduction in 
accordance with this clause. 
    Sec. 8.  Minnesota Statutes 1986, section 124.43, 
subdivision 2, is amended to read:  
    Subd. 2.  [DISTRICT PROCEDURES.] The school board of any 
district desiring a capital loan shall adopt a resolution 
stating the amount proposed to be borrowed, the purpose for 
which the debt is to be incurred, and an estimate of the dates 
when the facilities for which the loan is requested will be 
contracted for and completed.  The question of authorizing the 
borrowing of funds for the facilities shall be submitted to the 
voters of the district at a regular or special election.  The 
question submitted shall state the total amount to be borrowed 
from all sources.  A majority of those voting on the question 
shall be sufficient to authorize the district to effect the 
state loan application and also to issue the bonds on public 
sale in accordance with chapter 475.  Applications for loans 
shall be accompanied by (a) a copy of the resolution, and (b) a 
certificate by the clerk showing the vote at the election, (c) a 
certificate by the clerk and treasurer showing the then 
outstanding indebtedness of the district, and (d) a certificate 
by the county auditor of each county in which a portion of the 
district lies showing the information in the auditor's official 
records which is required to be used in computing the debt limit 
of the district under section 475.53, subdivision 4.  The 
clerk's and treasurer's certificate shall show, as to each 
outstanding bond issue, the amount originally issued, the 
purpose for which issued, the date of issue, the amount 
remaining unpaid as of the date of the resolution, and the 
interest rates and due dates and amounts of principal thereon.  
Applications shall be in the form and accompanied by the 
additional data which the commissioner and state board of 
education prescribe.  Applications must be received by the 
commissioner by December 1 of any year.  When an application is 
received, the commissioner shall obtain from the commissioner of 
revenue, and from the public utilities commission when required, 
the information in their official records which is required to 
be used in computing the debt limit of the district under 
section 475.53, subdivision 4. 
    Sec. 9.  Minnesota Statutes 1986, section 124.43, 
subdivision 3, is amended to read:  
    Subd. 3.  [AWARD OF LOANS RECOMMENDATIONS OF THE 
COMMISSIONER.] The commissioner shall examine and consider all 
applications for capital loans which have been recommended by 
the state board of education, and if any applicant district 
is promptly notify any district found not qualified it shall be 
promptly notified thereof by the state board of the state 
board's decision.  The commissioner shall make recommendations 
concerning each capital loan to the education committees of both 
houses of the legislature by February 1 of each year.  The 
commissioner shall also report on the funds remaining in the 
capital loan account, and if necessary, request that another 
bond issue be authorized.  On January 1 and July 1 of each year, 
the commissioner shall make a determination on all pending 
applications which have been on file with the commissioner more 
than one month.  If an applicant is qualified in the opinion of 
the commissioner and the aggregate of the amounts applied for 
does not exceed the amount available or which can be made 
available in the capital loan account, all loans so applied for 
shall be granted, subject to acceptance by the respective 
districts as specified below.  If the aggregate exceeds the 
amount which is or can be made available, the commissioner shall 
allot the available amount among the qualified applicant 
districts, or any of them, according to the commissioner's 
judgment and discretion based upon their respective needs.  The 
commissioner shall promptly certify to each qualified applicant 
district the amount, if any, of the capital loan granted to it, 
subject to adjustment under subdivision 1, clause (4). 
    Sec. 10.  Minnesota Statutes 1986, section 124.43, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [LEGISLATIVE ACTION.] Each capital loan must be 
approved in law. 
    If the aggregate amount of the capital loans exceeds the 
amount that is or can be made available, the commissioner shall 
allot the available amount among any number of qualified 
applicant districts, according to the commissioner's judgment 
and discretion, based upon the districts' respective needs. 
    Sec. 11.  Minnesota Statutes 1986, section 124.43, is 
amended by adding a subdivision to read: 
    Subd. 3b.  [DISTRICT REFERENDUM.] Upon receipt of the 
review and comment on the project, the question authorizing the 
borrowing of funds for the facilities must be submitted by the 
school board to the voters of the district at a regular or 
special election.  The question submitted shall state the total 
amount to be borrowed from all sources.  Approval of a majority 
of those voting on the question is sufficient to authorize the 
issuance of the obligations on public sale in accordance with 
chapter 475.  However, no capital loan is available to the 
district until the capital loan is approved in law and the 
question is approved by a majority of the voters of the district 
at a regular or special election.  The district shall mail to 
the commissioner of education a certificate by the clerk showing 
the vote at the election.  
    Sec. 12.  [124.477] [BOND ISSUE; MAXIMUM EFFORT SCHOOL 
LOANS; 1988.] 
     To provide money to be loaned to school districts as 
agencies and political subdivisions of the state to acquire and 
to better public land and buildings and other public 
improvements of a capital nature, in the manner provided by the 
maximum effort school aid law, the commissioner of finance shall 
issue and sell school loan bonds of the state of Minnesota in 
the maximum amount of $20,000,000, in addition to the bonds 
already authorized for this purpose.  The same amount is 
appropriated to the maximum effort school loan fund and must be 
spent under the direction of the commissioner of education to 
make debt service loans and capital loans to school districts as 
provided in sections 124.36 to 124.47.  The bonds must be issued 
and sold and provision for their payment must be made according 
to section 124.46.  Enough money to pay interest on the bonds to 
and including July 1 in the second year after the date of issue 
must be credited from the bond proceeds to the school loan bond 
account in the state bond fund.  Expenses incidental to the 
sale, printing, execution, and delivery of the bonds, including, 
but without limitation, actual and necessary travel and 
subsistence expenses of state officers and employees for those 
purposes, must be paid from the maximum effort school loan fund, 
and the money necessary for the expenses is appropriated from 
that fund.  
    Sec. 13.  Minnesota Statutes 1987 Supplement, section 
124.494, subdivision 4, is amended to read:  
    Subd. 4.  [AWARD OF GRANTS.] The commissioner shall examine 
and consider all applications for grants, and if any joint 
powers district is found not qualified, the commissioner shall 
promptly notify that joint powers board.  On January 1 and July 
1 of each year 1988, the commissioner shall make a determination 
on all pending applications that awards to no more than two 
qualified applicants whose applications have been on file with 
the commissioner more than one month.  If the applicants are 
determined to be qualified by the commissioner and the total 
amount of the grants applied for does not exceed the amount 
available or that can be made available in the incentive grant 
account, all grants so applied for shall be approved, A grant 
award is subject to verification by the joint powers districts 
as specified in subdivision 6.  If the total amount of 
the approved applications exceeds the amount that is or can be 
made available, the commissioner shall allot the available 
amount among equally between the qualified approved applicant 
districts, according to the commissioner's judgment and 
discretion based upon their respective needs.  The commissioner 
shall promptly certify to each qualified joint powers district 
the amount, if any, of the grant awarded to it. 
    Sec. 14.  Minnesota Statutes 1987 Supplement, section 
124.494, subdivision 5, is amended to read:  
    Subd. 5.  [REFERENDUM; BOND ISSUE.] Within 90 days after 
being awarded a grant under subdivision 4, the joint powers 
board shall submit the question of authorizing the borrowing of 
funds for the secondary facility to the voters of the joint 
powers district at a special election, which may be held in 
conjunction with the annual election of the school board members 
of the member districts.  The question submitted shall state the 
total amount of funding needed from all sources.  A majority of 
those voting in the affirmative on the question is sufficient to 
authorize the joint powers board to accept the grant and to 
issue the bonds on public sale in accordance with chapter 475.  
The clerk of the joint powers board must certify the vote of the 
bond election to the commissioner of education.  If the bonds 
are authorized question is approved by the voters, the 
commissioner shall notify the county auditor of each county in 
which the joint powers district is located approved applicant 
districts that the grant amount certified under subdivision 4 is 
available and appropriated for payment of principal and interest 
on the bonds issued under this subdivision, and the auditor 
shall reduce the joint powers district's debt service levies 
accordingly under this subdivision.  If a majority of those 
voting on the question do not vote in the affirmative, the grant 
must be canceled. 
    Sec. 15.  Minnesota Statutes 1987 Supplement, section 
124.494, subdivision 6, is amended to read:  
    Subd. 6.  [CONTRACT.] Each grant must be evidenced by a 
contract between the joint powers board and the state acting 
through the commissioner.  It The contract obligates the state 
to pay to the joint powers board an amount computed according to 
subdivision 4, upon receipt by the commissioner of a certified 
resolution of the joint powers board verifying that contracts 
have been entered into for construction or remodeling of the 
facilities for which the grant is awarded and that bonds of the 
joint powers district have been issued and sold in the amount 
necessary to pay all project costs in excess of the amount of 
the grant, and estimating the costs and according to a schedule, 
and terms and conditions acceptable to the commissioner of 
finance. 
    Sec. 16.  [124.4945] [LEVY FOR SEVERANCE PAY.] 
    A joint powers board established under section 124.494 may 
make a levy to provide severance pay and early retirement 
incentives under section 125.611, for any teacher as defined 
under section 125.12, subdivision 1, who is placed on 
unrequested leave as a result of the cooperative secondary 
facility agreement.  A joint powers board making a levy shall 
certify to each participating district tax levies sufficient to 
raise the amount necessary to provide the district's portion of 
severance pay and early retirement incentives.  The tax levy 
certified to each district must be expressed as a mill rate, 
that, when applied to the adjusted assessed valuation of all of 
the participating districts raises the amount necessary to 
provide severance pay and early retirement incentives.  Each 
participating school district shall include the levy in the next 
tax roll which it shall certify to the county auditor, and shall 
remit the collections of the levy to the joint powers board. 
    Sec. 17.  Minnesota Statutes 1987 Supplement, section 
124.495, is amended to read:  
    124.495 [STATE BOND AUTHORIZATION.] 
    To provide money for the cooperative secondary facilities 
grant program, the commissioner of finance, upon the request of 
the commissioner of education, shall issue and sell bonds of the 
state up to the amount of $8,000,000 $16,000,000 in the manner, 
upon the terms and with the effect prescribed by sections 
16A.631 to 16A.675 and the Minnesota Constitution, article XI, 
sections 4 to 7. 
    Sec. 18.  [124.82] [BUILDING CONSTRUCTION DOWN PAYMENT 
PROGRAM.] 
    Subdivision 1.  [CREATION OF A DOWN PAYMENT ACCOUNT.] A 
school district may create a down payment account as a separate 
account in its construction fund.  All proceeds from the down 
payment levy must be deposited in the capital expenditure fund 
and transferred to this account.  Interest income attributable 
to the down payment account must be credited to the account. 
    Subd. 2.  [USES OF THE ACCOUNT.] Money in the down payment 
account must be used as a down payment for the future costs of 
acquisition and betterment for a project that has been reviewed 
under section 121.15 and has been approved according to 
subdivision 3. 
    Subd. 3.  [FACILITIES DOWN PAYMENT LEVY REFERENDUM.] A 
district may levy the millage approved by a majority of the 
electors voting on the question to provide funds for a down 
payment for an approved project.  The election must take place 
no more than five years before the estimated date of 
commencement of the project.  The referendum must be held on a 
date set by the school board.  A referendum for a project not 
receiving a positive review and comment by the commissioner 
under section 121.15 must be approved by at least 60 percent of 
the voters at the election.  The referendum may be called by the 
school board and may be held: 
    (1) separately, before an election for the issuance of 
obligations for the project under chapter 475; or 
    (2) in conjunction with an election for the issuance of 
obligations for the project under chapter 475; or 
    (3) notwithstanding section 475.59, as a conjunctive 
question authorizing both the down payment levy and the issuance 
of obligations for the project under chapter 475.  Any 
obligations authorized for a project may be issued within five 
years of the date of the election. 
    The ballot must provide a general description of the 
proposed project, state the estimated total cost of the project, 
state whether the project has received a positive or negative 
review and comment from the commissioner of education, state the 
maximum amount of the down payment levy in mills, state the 
amount that will be raised by that millage in the first year it 
is to be levied, and state the maximum number of years that the 
levy authorization will apply. 
    The ballot must contain a textual portion with the 
information required in this section and a question stating 
substantially the following: 
    "Shall the down payment levy proposed by the board of 
.......... School District No. .......... be approved?" 
    If approved, the amount provided by the approved millage 
applied to each year's taxable valuation may be certified for 
the number of years approved. 
    In the event a conjunctive question proposes to authorize 
both the down payment levy and the issuance of obligations for 
the project, appropriate language authorizing the issuance of 
obligations must also be included in the question.  
    The district must notify the commissioner of education of 
the results of the referendum. 
    Subd. 4.  [EXCESS BUILDING CONSTRUCTION FUND LEVY 
PROCEEDS.] Any funds remaining in the down payment account that 
are not applied to the payment of the costs of the approved 
project before its final completion must be transferred to the 
district's debt redemption fund.  
    Sec. 19.  [124.83] [CAPITAL EXPENDITURE; HEALTH AND 
SAFETY.] 
    Subdivision 1.  [HEALTH AND SAFETY PROGRAM.] To receive 
health and safety revenue a district must submit to the 
commissioner of education an application for aid and levy by 
August 15 in the previous school year.  The application may be 
for hazardous substance removal, fire code compliance, or life 
safety repairs.  The application must include a health and 
safety program adopted by the school district board.  The 
program must include the estimated cost of the program by fiscal 
year. 
    Subd. 2.  [CONTENTS OF PROGRAM.] A district may adopt a 
health and safety program.  The program may include plans for 
hazardous substance removal, fire code compliance, or life 
safety repairs.  
    A hazardous substance plan must contain provisions for the 
removal or encapsulation of asbestos from school buildings or 
property, asbestos-related repairs, cleanup and disposal of 
polychlorinated biphenyls found in school buildings or property, 
and cleanup, removal, disposal, and repairs related to storing 
heating fuel or transportation fuels such as alcohol, gasoline, 
fuel, oil, and special fuel, as defined in section 296.01.  If a 
district has already developed a plan for the removal or 
encapsulation of asbestos, a new plan is not necessary for 
purposes of this section. 
    A fire safety plan must contain a description of the 
current fire code violation, a plan for the removal or repair of 
the fire hazard, and a description of safety preparation and 
awareness procedures to be followed until the hazard is fully 
corrected. 
    A life safety plan must contain a description of the life 
safety hazard and a plan for its removal or repair.  
    Subd. 3.  [HEALTH AND SAFETY REVENUE.] A district's health 
and safety revenue equals the approved cost of the health and 
safety program for the school year to which the levy is 
attributable, minus the unexpended portion of levies certified 
by the district in earlier years under section 275.125, 
subdivision 11c. 
    Subd. 4.  [HEALTH AND SAFETY LEVY.] To receive health and 
safety revenue, a district may levy an amount equal to the 
district's health and safety revenue as defined in subdivision 3 
multiplied by the lessor of one, or the ratio of: 
    (1) the quotient derived by dividing the adjusted assessed 
valuation of the district for the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the school year to which the levy is attributable, to 
    (2) 75 percent of the equalizing factor for the school year 
to which the levy is attributable. 
    Subd. 5.  [HEALTH AND SAFETY AID.] A district's health and 
safety aid is the difference between its health and safety 
revenue and its health and safety levy.  If a district does not 
levy the entire amount permitted, health and safety aid must be 
reduced in proportion to the actual amount levied. 
    Subd. 6.  [USES OF HEALTH AND SAFETY REVENUE.] Health and 
safety revenue may be used only for expenditures necessary to 
correct fire safety hazards, life safety hazards, or for the 
removal or encapsulation of asbestos from school buildings or 
property, asbestos-related repairs, cleanup and disposal of 
polychlorinated biphenyls found in school buildings or property, 
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 
296.01. 
    Subd. 7.  [PRORATION.] In the event that the health and 
safety aid available for any year is prorated, a district having 
its aid prorated may levy an additional amount equal to the 
amount not paid by the state due to proration. 
    Sec. 20.  Minnesota Statutes 1986, section 275.125, is 
amended by adding a subdivision to read: 
    Subd. 4a.  [DOWN PAYMENT LEVY.] A school district may levy 
the amount authorized for a down payment levy according to 
section 18. 
    Sec. 21.  Minnesota Statutes 1986, section 275.125, is 
amended by adding a subdivision to read: 
    Subd. 11d.  [EXTRA CAPITAL EXPENDITURE LEVY FOR LEASING 
BUILDINGS.] When a district finds it economically advantageous 
to rent or lease a building for a secondary vocational 
cooperative program and it determines that the capital 
expenditure facilities revenues authorized under section 4 are 
insufficient for this purpose, it may apply to the commissioner 
for permission to make an additional capital expenditure levy 
for this purpose.  An application for permission to levy under 
this subdivision must contain financial justification for the 
proposed levy, the terms and conditions of the proposed lease, 
and a description of the space to be leased and its proposed 
use.  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, 
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 for approved purposes.  The proceeds of this 
levy must not be used for leasing or renting a facility owned by 
a district or for custodial or other maintenance services. 
    Sec. 22.  Laws 1987, chapter 400, section 59, is amended to 
read: 
    Sec. 59.  [REPEALER.] 
    Sections 33 to 38 36 are repealed June 30, 1989. 
    Sec. 23.  [CAPITAL LOANS.] 
    Subdivision 1.  [LOAN TO MILACA SCHOOL DISTRICT.] A capital 
loan in an amount not to exceed $4,791,000 to independent school 
district No. 912, Milaca, is approved. 
    Subd. 2.  [LOAN TO HOLDINGFORD SCHOOL DISTRICT.] A capital 
loan in an amount not to exceed $1,087,000 to independent school 
district No. 738, Holdingford, is approved. 
    Subd. 3.  [LOAN TO REDWOOD FALLS SCHOOL DISTRICT.] A 
capital loan in an amount not to exceed $5,838,000 to 
independent school district No. 637, Redwood Falls, is approved. 
    Sec. 24.  [DEBT SERVICE.] 
    The legislature estimates that the amount that will need to 
be transferred from the general fund to the state bond fund to 
pay principal and interest due and to become due on state 
general obligation bonds issued for the cooperative secondary 
facilities grant program authorized by the amendment to 
Minnesota Statutes, section 124.495, contained in this article 
will be $608,900 for the fiscal year ending June 30, 1989. 
    Sec. 25.  [1988 LEVY FOR LEASING BUILDINGS.] 
    A district may levy in 1988 the amount the district would 
have been authorized to levy in 1987 for the cost of renting or 
leasing buildings according to Minnesota Statutes, section 
275.125, subdivision 12, had the authority to levy for this 
purpose not been repealed. 
    Sec. 26.  [APPROPRIATION.] 
    $8,000,000 is appropriated from the state building fund to 
the commissioner of education for fiscal year 1988 for grants to 
districts under the cooperative secondary facilities grant 
program according to Minnesota Statutes, section 124.494.  This 
appropriation is in addition to the amount appropriated by Laws 
1987, chapter 400, section 16, subdivision 4. 
    Sec. 27.  [REPEALER.] 
    Minnesota Statutes 1986, section 124.435; Minnesota 
Statutes 1987 Supplement, sections 124.245, subdivisions 3, 3a, 
and 3b; and 275.125, subdivision 11c, are repealed effective for 
the 1989-1990 school year. 
    Sec. 28.  [EFFECTIVE DATES.] 
    Sections 1 and 2 are effective the day following final 
enactment for projects that have not been submitted to the 
department for review and comment under Minnesota Statutes 1986, 
section 121.15.  Sections 6 to 18, 20, 23, 24, and 26, are 
effective the day following final enactment.  Sections 4, 5, and 
19 are effective for revenue for the 1989-1990 school year and 
thereafter. 
    Approved May 6, 1988

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