1.1 	A bill for an act
1.2 	relating to finance; requiring reports and
1.3 	recommendations to bring the state budget into
1.4 	compliance with generally accepted governmental
1.5 	accounting principles; requiring disclosure of the
1.6 	impact of inflation on state expenditures; amending
1.7 	Minnesota Statutes 2004, sections 16A.055, subdivision
1.8 	1; 16A.103, subdivisions 1a, 1b; 16A.11, subdivision 2.
1.9 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.10 	Section 1. Minnesota Statutes 2004, section 16A.055,
1.11 	subdivision 1, is amended to read:
1.12 		Subdivision 1.List. (a) The commissioner shall:
1.13 	(1) receive and record all money paid into the state
1.14 	treasury and safely keep it until lawfully paid out;
1.15 	(2) manage the state's financial affairs;
1.16 	(3) keep the state's general account books according to
1.17 	generally accepted government accounting principles;
1.18 	(4) keep expenditure and revenue accounts according to
1.19 	generally accepted government accounting principles;
1.20 	(5) develop, provide instructions for, prescribe, and
1.21 	manage a state uniform accounting system;
1.22 	(6) provide to the state the expertise to ensure that all
1.23 	state funds are accounted for under generally accepted
1.24 	government accounting principles; and
1.25 	(7) coordinate the development of, and maintain standards
1.26 	for, internal auditing in state agencies and, in cooperation
1.27 	with the commissioner of administration, report to the
2.1 	legislature and the governor by January 31 of odd-numbered
2.2 	years, on progress made.
2.3 	(b) As part of the comprehensive annual financial report,
2.4 	the commissioner shall list any laws that require the state's
2.5 	general fund budget not to be reported in accordance with
2.6 	generally accepted government accounting principles.

2.7 	Sec. 2. Minnesota Statutes 2004, section 16A.103,
2.8 	subdivision 1a, is amended to read:
2.9 		Subd. 1a.Forecast parameters.  The forecast must assume
2.10 	the continuation of current laws and reasonable estimates of
2.11 	projected growth in the national and state economies and
2.12 	affected populations.  Revenue must be estimated for all sources
2.13 	provided for in current law.  Expenditures must be estimated for
2.14 	all obligations imposed by law and those projected to occur as a
2.15 	result of inflation and variables outside the control of the
2.16 	legislature. ~~Expenditure estimates must not include an~~
2.17 	~~allowance for inflation.~~

2.18 	Sec. 3. Minnesota Statutes 2004, section 16A.103,
2.19 	subdivision 1b, is amended to read:
2.20 		Subd. 1b.Forecast variable.  In determining the rate of
2.21 	inflation, the application of inflation,the amount of state
2.22 	bonding as it affects debt service, the calculation of
2.23 	investment income, and the other variables to be included in the
2.24 	expenditure part of the forecast, the commissioner must consult
2.25 	with the chairs and lead minority members of the senate ~~State~~
2.26 	~~Government~~ Finance Committee and the house Ways and Means
2.27 	Committee, and legislative fiscal staff.  This consultation must
2.28 	occur at least three weeks before the forecast is to be
2.29 	released.  No later than two weeks prior to the release of the
2.30 	forecast, the commissioner must inform the chairs and lead
2.31 	minority members of the senate State Government Finance
2.32 	Committee and the house Ways and Means Committee, and
2.33 	legislative fiscal staff of any changes in these variables from
2.34 	the previous forecast.

2.35 	Sec. 4. Minnesota Statutes 2004, section 16A.11,
2.36 	subdivision 2, is amended to read:
3.1 		Subd. 2.Part one:  message.  Part one of the budget, the
3.2 	governor's message, shall include the governor's recommendations
3.3 	on the financial policy of the state for the coming biennium,
3.4 	describing the important features of the budget plan, embracing
3.5 	a general budget summary setting forth the aggregate figures of
3.6 	the budget so as to show the balanced relation between the total
3.7 	proposed expenditures and the total anticipated income, with the
3.8 	basis and factors on which the estimates are made, the amount to
3.9 	be borrowed, and other means of financing the budget for the
3.10 	coming biennium, compared with the corresponding figures for at
3.11 	least the last two completed fiscal years and the current year.
3.12 	The budget plan must include recommendations on how to bring the
3.13 	budget into compliance with generally accepted governmental
3.14 	accounting principles.The budget plan shall be supported by
3.15 	explanatory schedules or statements, classifying its
3.16 	expenditures by agencies and funds, and the income by agencies,
3.17 	sources, funds, and the proposed amount of new borrowing, as
3.18 	well as proposed new tax or revenue sources.  The budget plan
3.19 	shall be submitted for all special and dedicated funds, as well
3.20 	as the general fund, and shall include the estimated amounts of
3.21 	federal aids, for whatever purpose provided, together with
3.22 	estimated expenditures from them.

3.23 	Sec. 5. EFFECTIVE DATE.
 3.24 	This act is effective the day following final enactment.