1.1                          A bill for an act 
  1.2             relating to higher education; giving the board of 
  1.3             trustees of the Minnesota state colleges and 
  1.4             universities certain authority with respect to 
  1.5             property transactions, construction, repairs, and 
  1.6             improvements; amending Minnesota Statutes 1998, 
  1.7             sections 136F.36, subdivisions 1, 3, and by adding a 
  1.8             subdivision; 136F.60, subdivision 1, and by adding 
  1.9             subdivisions; and 136F.64, subdivision 1. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 1998, section 136F.36, 
  1.12  subdivision 1, is amended to read: 
  1.13     Subdivision 1.  [AUTHORITY TO ACQUIRE, DEVELOP, AND SELL 
  1.14  REAL PROPERTY FOR INSTRUCTIONAL PURPOSES.] For the purpose of 
  1.15  instructional construction by technical colleges, the board may 
  1.16  build, sell, or transfer personal property and may purchase or 
  1.17  otherwise acquire real property that it does not intend to use 
  1.18  as a permanent educational site.  The board may, upon the terms 
  1.19  and conditions it sets, develop ~~and~~, sell, transfer, or 
  1.20  otherwise dispose of real property acquired under this section.  
  1.21  A sale ~~shall~~ must be ~~for~~ at fair market value.  For purposes 
  1.22  of this section, a sale price resulting from public bidding, 
  1.23  public auction, or negotiations between unrelated parties acting 
  1.24  in their self-interest, is fair market value.  Where real 
  1.25  property acquired under this section cannot be sold ~~for fair~~ 
  1.26  ~~market value~~, the board may lease the real property under the 
  1.27  terms and conditions it sets.  The board may also contract for 
  2.1   the use of real property it does not own.  Where the board makes 
  2.2   improvements to real property it does not own, the 
  2.3   landowner ~~shall~~ may compensate the board for the fair market 
  2.4   value, nominal consideration, or without consideration as may be 
  2.5   agreed on between the parties, of the board's contribution to 
  2.6   the improvements.  No other authorizing legislation or 
  2.7   legislative approval is required for an acquisition, 
  2.8   improvement, or sale under this section.  Proceeds from the 
  2.9   sale, lease, or improvement of real property under this section 
  2.10  are appropriated to the board. 
  2.11     Sec. 2.  Minnesota Statutes 1998, section 136F.36, 
  2.12  subdivision 3, is amended to read: 
  2.13     Subd. 3.  [WARRANTIES.] The board may, in its discretion, 
  2.14  offer the warranties contained in chapter 327A, less extensive 
  2.15  warranties or no warranties. 
  2.16     Sec. 3.  Minnesota Statutes 1998, section 136F.36, is 
  2.17  amended by adding a subdivision to read: 
  2.18     Subd. 5.  [STATE EMPLOYEE PURCHASE.] Notwithstanding 
  2.19  Minnesota Statutes, section 15.054, personal or real property 
  2.20  resulting from instructional construction by technical colleges 
  2.21  may be sold to a state employee under the following conditions: 
  2.22     (1) there is reasonable public notice of the sale; 
  2.23     (2) the sale is by public auction, sealed bid, or listing 
  2.24  with a licensed real estate broker; 
  2.25     (3) the state employee offers the highest price; and 
  2.26     (4) the state employee was not involved in the development 
  2.27  of the property or the award of the sale. 
  2.28     Sec. 4.  Minnesota Statutes 1998, section 136F.60, 
  2.29  subdivision 1, is amended to read: 
  2.30     Subdivision 1.  [~~PURCHASE OF NEIGHBORING PROPERTY; STATE~~ 
  2.31  ~~UNIVERSITIES~~ ACQUISITION OF REAL ESTATE.] The board may ~~purchase~~ 
  2.32  acquire property ~~adjacent to or in the vicinity of the campuses~~ 
  2.33  as necessary for the development of a state college or 
  2.34  university.  Before taking final action, the board shall consult 
  2.35  with the chairs of the senate finance committee and the house 
  2.36  ways and means committee about the proposed action.  The board 
  3.1   shall explain the need to acquire property, specify the property 
  3.2   to be acquired, and indicate the source and amount of money 
  3.3   needed for the acquisition.  The amount needed may be spent from 
  3.4   sums previously appropriated for purposes of the state colleges 
  3.5   and universities, including, but not limited to, general fund 
  3.6   appropriations for instructional or noninstructional 
  3.7   expenditures, general fund appropriations carried forward, or 
  3.8   state college and university activity fund appropriations.  The 
  3.9   board may pay relocation costs, at its discretion, when 
  3.10  acquiring property.  
  3.11     Sec. 5.  Minnesota Statutes 1998, section 136F.60, is 
  3.12  amended by adding a subdivision to read: 
  3.13     Subd. 4.  [DISPOSAL OF SURPLUS REAL ESTATE.] (a) If the 
  3.14  board determines the college or university-owned real estate 
  3.15  under the board's control is no longer needed, the board may 
  3.16  sell, assign, transfer, or otherwise dispose of all or part of 
  3.17  the state's interest in the surplus real estate, as provided in 
  3.18  this subdivision.  The compensation for the surplus real estate 
  3.19  must be determined by the board.  Before taking final action, 
  3.20  the board must consult with the chairs of the senate finance 
  3.21  committee and the house ways and means committee about the 
  3.22  proposed action. 
  3.23     (b) The sale or other disposal of any surplus real estate 
  3.24  under this subdivision must be made subject to any covenants, 
  3.25  terms, and conditions required by or acceptable to the board.  
  3.26  The board must offer any real estate it determines to be surplus 
  3.27  for public sale.  Before any public sale is made, the board must 
  3.28  publish a notice of the public sale at least once in each week 
  3.29  for four successive weeks in the State Register and also in a 
  3.30  newspaper of general distribution in the city or county in which 
  3.31  the real estate to be sold is situated.  The notice must specify 
  3.32  the time and place at which the sale will commence, a general 
  3.33  description of the lots or tracts to be offered, and a general 
  3.34  statement of the terms of sale.  The sale may occur by public 
  3.35  auction, sealed bid, listing with a real estate broker, or other 
  3.36  means selected by the board.  Real estate must be sold for not 
  4.1   less than its appraised value, except as provided in this 
  4.2   subdivision.  Real estate remaining unsold after the offering 
  4.3   may be sold to anyone agreeing to pay the real estate's 
  4.4   appraised value, or for less than the appraised value if the 
  4.5   board determines that accepting less than the appraised value 
  4.6   serves a public purpose.  The sale must continue until all real 
  4.7   estate is sold or until the board orders a reappraisal or 
  4.8   withdraws the remaining real estate from sale.  The sale may 
  4.9   occur by public auction, sealed bid, listing with a licensed 
  4.10  real estate broker, or other means as provided in this 
  4.11  subdivision. 
  4.12     (c) The cost of any survey or appraisal may be added to and 
  4.13  made a part of the appraised value of the real estate to be 
  4.14  sold, whether to any political subdivision of the state or to a 
  4.15  private purchaser as provided in this subdivision. 
  4.16     (d) The conveyance of any college or university-owned 
  4.17  interest in surplus real estate pursuant to clause (a) of this 
  4.18  subdivision must be by legal documents which must be in a form 
  4.19  approved by the attorney general.  The legal documents must 
  4.20  reserve all minerals and mineral rights to the state, and may 
  4.21  contain such other reservations, easements, restriction, 
  4.22  covenants, and other provisions required by or acceptable to the 
  4.23  board. 
  4.24     (e) The sale or other disposal of any surplus real estate 
  4.25  under this subdivision must be subject to provisions of section 
  4.26  16A.695 including any orders promulgated by the commissioner of 
  4.27  finance to the extent applicable.  Money received by the state 
  4.28  under this section shall be retained by the board unless 
  4.29  otherwise provided by law. 
  4.30     (f) The authority of the board to sell or otherwise dispose 
  4.31  of surplus real estate under this subdivision is in addition to 
  4.32  the provisions of section 15.16.  
  4.33     (g) Proceeds from the sale or other disposition authorized 
  4.34  under this subdivision must be retained by the board unless 
  4.35  otherwise provided by law. 
  4.36     Sec. 6.  Minnesota Statutes 1998, section 136F.60, is 
  5.1   amended by adding a subdivision to read: 
  5.2      Subd. 5.  [TRANSFER OF STATE COLLEGE OR UNIVERSITY-OWNED 
  5.3   IMPROVEMENTS.] The board may sell, transfer, or otherwise 
  5.4   dispose of an improvement located on state-owned lands, the 
  5.5   compensation for which shall be determined by the board.  The 
  5.6   sale, transfer, or disposition must be accomplished by a bill of 
  5.7   sale, describing the improvement transferred and the terms and 
  5.8   conditions of the sale or transfer.  Proceeds from the sale, 
  5.9   transfer, or disposition must be retained by the board unless 
  5.10  otherwise provided by law. 
  5.11     Sec. 7.  Minnesota Statutes 1998, section 136F.60, is 
  5.12  amended by adding a subdivision to read: 
  5.13     Subd. 6.  [LEASING OF STATE COLLEGE OR UNIVERSITY REAL 
  5.14  PROPERTY.] (a) The board may grant a leasehold interest in real 
  5.15  estate, offered at public or private sale, as provided in this 
  5.16  subdivision. 
  5.17     (b) The term of the leasehold interest in the real estate 
  5.18  must not exceed 30 years.  In connection with granting a 
  5.19  leasehold interest, the board may sell or otherwise dispose of 
  5.20  any buildings, improvements, fixtures, and personal property 
  5.21  located on the real estate.  Before taking final action, the 
  5.22  board must consult with the chairs of the senate finance 
  5.23  committee and the house ways and means committee about the 
  5.24  proposed sale.  Proceeds from the lease under this subdivision 
  5.25  are appropriated to the board unless otherwise provided by law. 
  5.26     (c) Any agreement or instrument granting a leasehold 
  5.27  interest in real estate for a term of more than five years, or 
  5.28  conveying any buildings or other property in connection with a 
  5.29  leasehold interest, under clause (b) of this subdivision, must 
  5.30  be in a form approved by the attorney general.  The agreement or 
  5.31  instrument may contain such covenants, terms, and conditions as 
  5.32  may be required by or acceptable to the board. 
  5.33     (d) Granting of a leasehold interest under this subdivision 
  5.34  is subject to the provisions of section 16A.695 including any 
  5.35  orders promulgated by the commissioner of finance to the extent 
  5.36  applicable.  
  6.1      Sec. 8.  Minnesota Statutes 1998, section 136F.64, 
  6.2   subdivision 1, is amended to read: 
  6.3      Subdivision 1.  [GENERAL AUTHORITY; CONSTRUCTION; 
  6.4   IMPROVEMENTS.] (a) Specific legislative authority is not 
  6.5   required for repairs or minor capital projects financed with 
  6.6   operating appropriation or institutional receipts that: 
  6.7      (1) are undertaken for asset preservation or code 
  6.8   compliance purposes; or 
  6.9      (2) do not materially increase the net square footage of 
  6.10  the institution; and 
  6.11     (3) do not materially increase the costs of instructional 
  6.12  programs. 
  6.13     Minor capital projects authorized by this section may not 
  6.14  exceed a project cost of $250,000.  For any project under this 
  6.15  section with a cost in excess of $100,000, unless the board of 
  6.16  trustees determines that an emergency exists, the board must 
  6.17  notify the chair of the finance committee of the senate, and the 
  6.18  chairs of the ways and means committee and the capital 
  6.19  investment committee of the house in writing prior to incurring 
  6.20  any contractual obligations. 
  6.21     (b) The board shall supervise and control the preparation 
  6.22  of plans and specifications for the construction, alteration, 
  6.23  repair, or enlargement of state college and university 
  6.24  buildings, structures, and improvements for which appropriations 
  6.25  are made to the board.  The board shall advertise for bids and 
  6.26  award contracts in connection with the improvements, supervise 
  6.27  and inspect the work, approve necessary changes in the plans and 
  6.28  specifications, approve estimates for payment, and accept the 
  6.29  improvements when completed according to the plans and 
  6.30  specifications.